Opera Australia v Sydney Metro; Kritikos Developments Pty Ltd trading as Iron Duke Hotel v Sydney Metro - [2020] NSWLEC 28 - NSWLEC 2020 case summary — Zoe

NSWNSWLEC

Opera Australia v Sydney Metro; Kritikos Developments Pty Ltd trading as Iron Duke Hotel v Sydney Metro

[2020] NSWLEC 28

Land and Environment Court (NSW)|2020-04-06|Before: Robson J

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At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2020-04-06

Before

Robson J

Catchwords

(2013) 195 LGERA 182 Australian Competition and Consumer Commission (ACCC) v Allphones Retail Pty Ltd (No 3) (2009) 259 ALR 541

Source

Original judgment source is linked above.

Catchwords

(2013) 195 LGERA 182 Australian Competition and Consumer Commission (ACCC) v Allphones Retail Pty Ltd (No 3) (2009) 259 ALR 541

Judgment (14 paragraphs)

[1]

Judgment

Before the Court are applications made on behalf of Opera Australia and Kritikos Developments Pty Ltd (collectively, the 'applicants') in proceedings Opera Australia v Sydney Metro (2018/00183630) ('Opera proceedings') and Kritikos Developments Pty Ltd trading as Iron Duke Hotel v Sydney Metro (2019/00251688) ('Iron Duke proceedings') in relation to the hearing of separate questions ordered on 2 October 2019 pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) ('UCPR').
Although the hearing of the separate questions was to commence on 1 April 2020, by way of notices of motion filed 31 March 2020, the applicant in each of the proceedings seeks, in summary, orders that: first, the Court make a preliminary determination as to the admissibility of various parts of the extensive evidence sought to be relied upon by Sydney Metro in the hearing of the separate questions; second, the Court revoke the order made on 2 October 2019 insofar as it relates to the separate determination of a specific question, being Question 1(a)(ii); and, in the alternative to the second order, the Court revoke the order made on 2 October 2019 for the separate determination of all questions and that the matters proceed to final hearing.
For the reasons that follow, and with some reluctance, I find that the order made on 2 October 2019 providing for the separate determination of preliminary questions should be revoked and that each matter proceed to final hearing.

[2]

Background

Each matter has a somewhat tortuous procedural history which provides context for consideration of the detailed submissions made at the hearing of the motions which proceeded on 6 April 2020.
Both the Opera proceedings, commenced in June 2018, and the Iron Duke proceedings, commenced in August 2019, are appeals made pursuant to s 66 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ('Just Terms Act'). The appeals relate to Sydney Metro's compulsory acquisition of subsurface stratum on 11 October 2017 for the purpose of tunnelling associated with the construction of the Sydney Metro City and Southwest project.
Schedule 6B of the Transport Administration Act 1988 (NSW) ('Transport Act') contains the statutory provisions in relation to compensation for land acquired for the purpose of underground rail facilities and relevantly provides: Schedule 6B Special provisions for underground rail facilities 1 Interpretation (1) In this Schedule - rail authority means RailCorp, Sydney Metro, Sydney Trains, ARTC or TfNSW. underground rail facilities means - (a) rail infrastructure facilities that are located under the surface of land, and (b) structures and facilities for or associated with the provision of railway services (such as railway stations, platforms, access ways and vents), being structures and facilities that are located under the surface of land. … 2 No compensation for acquisition of land for underground rail facilities (1) If land under the surface is compulsorily acquired under the Land Acquisition (Just Terms Compensation) Act 1991 for the purpose of underground rail facilities, compensation is not payable under that Act unless - (a) the surface of the overlying soil is disturbed, or (b) the support of that surface is destroyed or injuriously affected by the construction of those facilities, or (c) any mines or underground working in or adjacent to the land are thereby rendered unworkable or are injuriously affected. (2) Section 62(2) of the Land Acquisition (Just Terms Compensation) Act 1991 does not apply to the compulsory acquisition of land under that Act for the purpose of underground rail facilities. (3) Expressions used in this clause have the same meaning as in the Land Acquisition (Just Terms Compensation) Act 1991. (4) This clause extends to the acquisition of land for the purpose of underground rail facilities before the commencement of this clause, but not so as to affect any payment or award of compensation made before that commencement. ...
The primary dispute for present purposes is that while Sydney Metro notes that the land was acquired "for the purpose of underground rail facilities" within the meaning of cl 2(1) of Sch 6B of the Transport Act, it maintains that compensation is not payable under the Just Terms Act because: 1. the surface of the overlying soil has not been disturbed; and 2. the support of that surface is not destroyed or injuriously affected by the construction of the facilities.
As noted at [6] above, the term "underground rail facilities" is defined in cl 1(1) of Sch 6B as "(a) rail infrastructure facilities that are located under the surface of the land, and (b) structures and facilities for or associated with the provision of railway services (such as railway stations, platforms, access ways and vents), being structures and facilities that are located under the surface of land". Further, the term "rail infrastructure facilities" is relevantly defined in s 3 of the Transport Act as including the railway track, associated track structures, and tunnels.
If either applicant falls within the contemplation of cl 2(1) of Sch 6B, it is entitled to an amount of compensation to be determined in accordance with the Just Terms Act, and whether this be the case has formed the basis for part of the separate questions for determination that are presently before the Court.
Pursuant to directions made by the Court in 2018, Opera Australia filed and served evidence including: an expert town planning report of Kerry Gordon dated 21 September 2018; an expert heritage report of Paul Rappoport dated 27 August 2018; and an expert geotechnical report of Paul Roberts dated 6 June 2018. Sydney Metro thereafter in November 2018 filed an expert town planning report of Paul Grech dated 9 November 2018 and an expert heritage report of Stephen Davies dated 6 November 2018.
On 12 December 2018, Sheahan J made an order pursuant to r 28.2 of the UCPR for a concurrent separate hearing and determination of the following question in three separate proceedings, each of which concerned the acquisition of subsurface stratum for the Sydney Metro City and Southwest project - being, the Opera proceedings; Landan Developments Pty Ltd v Sydney Metro; and Altomonte Holdings Pty Ltd v Sydney Metro: "Are the circumstances identified in paragraphs (a), (b) and (c) of clause 2 of Sch 6B to the Transport Administration Act 1998 limited to circumstances of the kind specified that have occurred after construction of the relevant underground rail facilities?" ('First Separate Question').
At the hearing of the First Separate Question before Moore J on 13 May 2019, the Court was informed that the tunnelling under the Opera Australia land had been completed.
On 2 October 2019, following the judgment in relation to the First Separate Question, Landan Development Pty Ltd v Sydney Metro; Opera Australia v Sydney Metro; Altomonte Holdings Pty Ltd v Sydney Metro [2019] NSWLEC 65, Moore J made a further order with the consent of the parties pursuant to r 28.2 of the UCPR for a separate hearing and determination of the following questions in the Opera proceedings and the Iron Duke proceedings, in advance of other issues in the proceedings: "1(a) Whether for the purpose of clause 2 of Schedule 6B of the Transport Administration Act 1988 (Transport Act): i. The surface of the soil overlying the land acquired by the Respondent from the Applicant is disturbed; or ii. The support of the surface of the overlying soil of the Land is destroyed or injuriously affected; by the construction of the underground rail facilities for the purpose of the Sydney Metro City and Southwest project. 1(b) If clauses 2(1)(a) and/or (b) of Schedule 6B of the Transport Act are engaged, is the amount of compensation payable by the Respondent under the Land Acquisition (Just Terms) Compensation Act 1991 (NSW) (Just Terms Act) to be determined having regard only to the matters specified in s 55 of the Just Terms Act." ('Second Separate Questions').
For clarity, as it will be necessary to refer to each of the individual components of the Second Separate Questions above at various points throughout this judgment, I will use the following descriptors - 'Question 1(a)(i)', which I note refers to the corresponding criterion derived from cl 2(1)(a) of Sch 6B of the Transport Act; 'Question 1(a)(ii)', which similarly refers to the corresponding criterion derived from cl 2(1)(b) of Sch 6B; and 'Question 1(b)' which refers to the final component of the Separate Second Questions.
Also on 2 October 2019, the hearing of the Second Separate Questions was fixed for seven days commencing on 1 April 2020 and, thereafter that time, was extended to 9 days. It is understood that 9 days was allocated for the hearing of the Second Separate Questions because the Court was informed that there may be contested evidence and, further, that it was anticipated that other parties involved with compulsory acquisition hearings related to the Sydney Metro City and Southwest project, including Landan Developments Pty Ltd and Altomonte Holdings Pty Ltd, may wish to participate (or be heard) in relation to the Second Separate Questions. As will be seen, those parties have not participated in the current proceedings.
Some further aspects of the procedural history should be noted: 1. The orders made by consent on 2 October 2019 included an order that the parties confer and exchange any agreed or assumed statement of facts; an order granting leave to the parties to adduce expert evidence in the disciplines of geotechnical engineering, town planning and heritage "in respect of the separate questions"; and an order that the applicants and Sydney Metro file and serve their evidence in respect of the Second Separate Questions by 22 November 2019 and 24 February 2020 respectively. The evidence now before the Court indicates that during October 2019 some effort was made by the parties to agree on facts, however no agreement was reached and the parties proceeded to marshal evidence. 2. The Second Separate Questions proceedings were listed before Moore J on 4 March 2020 for directions, at which time the applicants provided Moore J with a document styled "Applicants' Issues for Consideration at the Case Management Hearing on 4 March 2020", which noted that the: "content of [evidence filed on behalf of Sydney Metro on 21 February 2020] was beyond what had been contemplated by the Applicants, having regard to the narrow basis upon which the Applicants had put their cases as revealed in Mr Braybrooke's [the applicants' geotechnical expert] reports. This gives rise to matters of considerable difficulty for the future conduct of the hearing of the Second Separate Question." The applicants also submitted that they were not intending to rely upon any town planning evidence in the hearing of the Second Separate Questions "given the way the Applicant puts its case", and expressed concern that Sydney Metro had served town planning and related evidence which the applicants maintained related to the issue of the "highest and best use" of the land at the date of the compulsory acquisition being 11 October 2017. Although there were slightly different submissions made in relation to the Opera proceedings and the Iron Duke proceedings (each of whom shared common legal representation), in response to questions from Moore J, the applicants' counsel (Tcpt, 4 March 2020, p 7(35), p 8(26-33)) informed the Court that the applicants were not intending to rely upon any town planning evidence (specifically in relation to highest and best use). 1. The matters were again listed before Moore J on 9 March 2020 for further directions where again, the applicants' counsel (Tcpt, 9 March 2020, p 1(38-42)) indicated that the applicants did not intend to rely upon town planning evidence. 2. As a result of the Court's COVID-19 Pandemic Arrangements Policy issued on 20 March 2020, the matters were listed before me for mention on 25 March 2020 to determine whether the hearing could proceed by way of audio visual link ('AVL'), and again for pre-trial directions on 27 March 2020. 3. On 27 March 2020, as the parties indicated the hearing in relation to the Second Separate Questions would likely occupy no more than three days (on the basis that no other parties were seeking to participate) and due to the limited availability of AVL facilities, the Second Separate Questions were set down to commence on 6 April 2020 in lieu of 1 April 2020. At that time, counsel for the applicants indicated that as a result of evidence recently filed by Sydney Metro, the applicants intended to make a discrete application for preliminary rulings on evidence to be relied upon by Sydney Metro and/or a partial or full revocation of the order made on 2 October 2019 for the Second Separate Questions. Leave was granted for the filing of the motions presently before the Court on 27 March 2020.
Due to technical difficulties with the AVL, the hearing of the motions proceeded, with the agreement of the parties, by way of audio link (telephone conference) on 6 April 2020. Mr T S Hale of senior counsel appeared with Mr P Folino Gallo of counsel for the applicants, and Mr N J Owens of senior counsel appeared with Mr L Waterson of counsel for Sydney Metro.

[3]

Nature of the relief sought

In order to understand the submissions made, the precise orders sought in the motions are: "1 That there be a preliminary determination as to the admissibility of the following evidence and in particular the portions set out in Schedule A hereof; a. Report of Greg Kotze dated 21 February 2020 filed in the Opera Australia Proceedings. b. Report of Greg Kotze dated 21 February 2020 filed in the Kritikos Developments Pty Ltd Proceedings. c. Joint Report of Greg Kotze and John Braybrooke dated 19 March 2020 filed in the Opera Australia Proceedings d. Joint Report of Greg Kotze and John Braybrooke dated 19 March 2020 filed in the Kritikos Developments Pty Ltd Proceedings. e. Statement of Evidence of Paul Grech dated 24 February 2020 filed in the Kritikos Developments Pty Ltd Proceedings. f. Statement of Evidence of Stephen Davies dated 9 November 2018 filed in the Opera Australia Proceedings. g. Statement of Evidence of Paul Grech dated 9 November 2018 filed in the Opera Australia Proceedings. h. Supplementary Statement of Evidence of Paul Grech dated 12 February 2020 filed in the Opera Australia Proceedings. i. Expert Town Planning Report of Kerry Gordon dated 28 September 2018 filed in the Opera Australia Proceedings. 2 That the order made on [date] pursuant to rule 28.2 of the Uniform Civil Procedure Act, that Question 1(a)(ii) be separately determined, be revoked. 3 In the alternative to prayer 2 hereof, that the order made on 2 October 2019 pursuant to rule 28.2 of the Uniform Civil Procedure Act, that Questions 1(a)(i), 1(a)(ii) and 1(b) be separately determined, be revoked. 4 That the matter be listed for final hearing on a date convenient to the Court. 5 Any further order that the Court thinks fit."
The discrete parts of the evidence of the 9 expert (and joint expert) reports to which objection is taken, but, unhelpfully, not the grounds of those objections, are set out in Schedule A to the motions. In summary, in the Opera proceedings, the applicant objects to various paragraphs of the geotechnical report of Greg Kotze dated 21 February 2020; various paragraphs of the joint geotechnical report of Greg Kotze and John Braybrooke dated 19 March 2020; the whole of the heritage report of Stephen Davies dated 9 November 2018; the whole of the town planning report of Paul Grech dated 9 November 2018; the whole of the supplementary report of Paul Grech dated 12 February 2020; and the whole of the town planning report of Kerry Gordon dated 28 September 2018. In relation to the Iron Duke proceedings, the applicant objects to portions of the report of Greg Kotze dated 21 February 2020; various paragraphs of the joint report of Greg Kotze and John Braybrooke dated 19 March 2020; and the whole of the report of Paul Grech dated 24 February 2020.
As is clear, the first prayer in each motion is an order that there be a preliminary determination as to the admissibility of nominated parts of the evidence comprising 9 expert reports which Sydney Metro intends to rely upon in relation to the Second Separate Questions. The second prayer seeks an order revoking the orders for the separate determination only in so far as they concern Question 1(a)(ii). The third prayer seeks, in the alternative to the second prayer, an order revoking the order made on 2 October 2019 for the separate determination of the Second Separate Questions in their entirety and for the matters to proceed to final hearing. Sydney Metro, subject to one matter considered below, opposes the orders sought. I will briefly outline the positions of the parties, who provided detailed oral and written submissions, prior to considering each of the orders sought.

[5]

Applicants' position

The applicants primarily submit that, when the order for the Second Separate Questions was made, it was made without knowing what facts may be agreed; the nature of the evidence to be relied upon; what facts and evidence might be in issue; and that in November 2019, when the applicants filed their evidence upon which they intended to rely on in respect of the determination of the Second Separate Questions, they "saw the factual inquiry as being within a narrow compass". As such, when Sydney Metro served its evidence in late February 2020, the applicants first became aware that Sydney Metro had adopted a "very different approach" to Question 1(a)(ii) than that of the applicants, whose approach was founded upon various propositions distilled from the applicants' geotechnical evidence. The applicants' position was also based upon the following assumptions: first, any redevelopment of the land involving the erection of a building will require the surface of the land to support the redeveloped building; second, that any such support is controlled by foundations and structural design; and third, that each of the aforementioned factors are, in turn, supported by the strength of the soil and rocks supporting the foundations.
The applicants submit that Sydney Metro's evidence now goes beyond the contemplation of the applicants' evidence and seeks to put in issue the highest and best use of the land for the purpose of determining the answer to Question 1(a)(ii). The applicants say that the planning evidence which has been marshalled was intended to be the foundation of their valuation evidence as to the market value of the acquired land and as the foundation for an assessment based upon loss attributable to severance under s 57 of the Just Terms Act, and that the applicants did not intend to rely upon its town planning evidence for the purpose of the Second Separate Questions. Conversely, the evidence now sought to be relied upon by Sydney Metro including the town planning evidence, which placed reliance upon earlier heritage expert evidence, disagrees with the town planning evidence marshalled on behalf of the applicants. In particular, the applicants say that there is a fundamental difference in the approaches of each of the town planners about potential constraints on development and that Mr Grech, Sydney Metro's town planner, states that potential constraints relate to flooding; the existence of acid sulfate soils; unknown site contamination conditions; and heritage aspects.
The applicants submit that they are presently unable to marshal evidence to respond to Sydney Metro's evidence (which the applicants submit is mostly irrelevant) and therefore seek a preliminary determination in relation to the admissibility of the disputed evidence. Further, if the Court rules against the applicants in relation to the preliminary ruling on admissibility, the applicants will be required to apply to adjourn the hearing to marshal further evidence in response.
In relation to the potential necessity of marshalling further evidence, similar submissions were made in relation to both the Opera proceedings and the Iron Duke proceedings, however a further submission was made in relation to the Iron Duke proceedings on the basis that, in those proceedings, the applicant was not granted leave to commence proceedings out of time until 4 October 2019. As a result, the applicant in those proceedings had not filed town planning evidence and has had "no realistic opportunity" to file evidence in response to the town planning evidence of Mr Grech filed for Sydney Metro on 24 February 2020 in the Iron Duke proceedings.
The remaining submissions made by the applicants may be summarised as follows: 1. The dispute in relation to the town planning issues as to highest and best use cannot be resolved without resolution of the disputes as to the constraints on the development of the land, which will require further expert evidence to be marshalled on behalf of the applicants. 2. The dispute between the town planning experts regarding potential constraints on redevelopment is fundamental to their different approaches, and incorporates other aspects of contention such as flooding; acid sulfate soils; unknown site contamination; and heritage questions. Because the applicants submit that the evidence marshalled otherwise supports their argument that the surface has been injuriously affected by the construction of the underground rail facilities (within the meaning of cl 2(1)(b) of Sch 6B of the Transport Act), the determination of the highest and best use as at the acquisition date cannot be a relevant question in relation to this aspect. 3. Although the rules of evidence do not apply in Class 3 proceedings, the probative value of the town planning evidence of Mr Grech is "so slight it is outweighed by the danger" that it would be unfairly prejudicial to the applicants because, first, they are unable to respond to it; second, that the Court in determining the highest and best use as at the acquisition date would affect the subsequent valuation evidence; and third, even if the applicants marshalled additional evidence (which would itself involve significant additional cost), that additional evidence may be otiose if the applicants were to succeed on Question 1(a)(i).

[6]

Sydney Metro's position

Sydney Metro primarily submits that it is inappropriate to make advance rulings in relation to the evidence for two reasons: first, the Court is not bound by the rules of evidence; and second, the applicants have not specified the grounds upon which the disputed evidence should not be admitted.
To the extent that the applicants rely upon s 135 of the Evidence Act 1995 (NSW) ('Evidence Act') in claiming that the probative value of the disputed evidence is substantially outweighed by being unfairly prejudicial, Sydney Metro submits that the Court would accept that the applicants' view of the probative value of the disputed evidence is based upon the applicants' approach to their interpretation of cl 2(1)(b) of Sch 6B of the Transport Act, whereas the disputed evidence has a higher probative value on Sydney Metro's approach. This approach, in summary, is that the "support of the surface", to which the criterion refers, is the capacity of the physical materials overlying the acquired land and beneath the surface to be able to support the weight imparted upon them by the land (which is referred to in Sydney Metro's geotechnical evidence as the land's "load bearing capacity"). Further, Sydney Metro's primary position is that the criterion is only satisfied if the load bearing capacity of the overlying land in its present condition is affected by the construction of the tunnels. Again, in response to the applicants' submissions, Sydney Metro says that the disputed evidence does not simply involve identifying a particular highest and best use of the land.
Further, in order to determine the relevance and probative value of the disputed evidence, Sydney Metro submits that the Court would be required to determine the proper interpretation of the Transport Act, which is the ultimate issue in the proceedings in so far as the Second Separate Questions are concerned. In addition, given the dispute about relevance depends upon a fundamental difference between the parties in relation to the substantive meaning of the relevant sections of the Transport Act, the Court would not rule on admissibility in advance of full argument on the merits.
In response to the applicants' claim that the probative value of the disputed evidence is "outweighed by the danger that it would be unfairly prejudicial", Sydney Metro submits that if the hearing of the Second Separate Questions is vacated as a consequence of the applicants' motions, there will be ample time for the applicants to prepare evidence in response to the disputed evidence. In any event, Sydney Metro submits that the applicants clearly made a forensic decision not to adduce any evidence in reply to the now disputed evidence and that decision was notified to the Court (and Sydney Metro) on a number of occasions at various directions hearings.
Finally, if the applicants now wish to adduce evidence in reply, Sydney Metro submits that they should seek orders to that effect.

[7]

Consideration

While I accept the Court has power to make an advance ruling on the admissibility or use of evidence pursuant to s 192A of the Evidence Act "if it considers it appropriate to do so", and whilst I accept that pursuant to s 38(2) of the Land and Environment Court Act 1979 (NSW), the Court in these proceedings is not bound by the rules of evidence and can inform itself in any manner it sees fit, I accept the submission of Sydney Metro that the principles developed to inform whether it is "appropriate" to make a determination under s 192A of the Evidence Act are relevant to the exercise of the Court's discretion to grant the relief sought by the applicants.
It is clear, and I find, that the probative value of the disputed evidence will be dependent upon the interpretation of cl 2(1)(b) of Sch 6B, noting that there are competing interpretations proposed by the parties.
Further, having considered the parts of the extensive disputed evidence about which the applicants make objection (without specifying the particular grounds of objection) and the documents to which the applicants directed the Court, I accept the submission of Sydney Metro that the disputed evidence does not simply go to identifying a particular highest and best use.
Leaving aside the fact that the rules of evidence do not strictly apply, there are a number of reasons why the Court may decline to make an advance ruling under s 192A of the Evidence Act (see for example Australian Competition and Consumer Commission (ACCC) v Allphones Retail Pty Ltd (No 3) (2009) 259 ALR 541; [2009] FCA 1075 at [12]). In the ordinary case, the Court deals with objections to evidence at or shortly before hearing and s 192A of the Evidence Act empowers the Court to make rulings in the interests of efficient trial management. Despite this, in the present proceedings, I find that the Court would be required to construe the relevant sections of the Transport Act in order to determine whether the evidence was admissible. Put simply, I do not consider that the Court is able to make an advance ruling as to the admissibility of the material objected to absent the process of statutory construction and without first having a hearing and determining the parties respective approaches to the construction of the relevant sections: Gondarra v Minister for Families, Housing, Community Services and Indigenous Affairs [2012] FCA 185 at [23], [34].
I am not persuaded by the applicants' submission that when they filed their further "limited in its scope" evidence in November 2019, they considered the factual inquiry as being within a "narrow compass", in circumstances where the parties had agreed and the Court had allocated a hearing for seven days with explicit directions for the filing of evidence including expert evidence relating to town planning, geotechnical engineering and heritage. Furthermore, I consider that there is no substance in the submission made by the applicants that the Court was "in error in considering that the questions were appropriate for separate determination without knowing the facts or the scope of the evidence against which the Second Separate Question was to be determined" (applicants' submissions dated 31 March 2020 at (16)), in circumstances where it is apparent that the order made on 2 October 2019 was by consent.
Despite this, it is not uncommon, nor inappropriate, for a separate question to be set down where the precise nature and extent of the evidence is not known. The applicants participated in, and on one view were the beneficiary of, orders and directions that allowed them to choose the evidence they considered appropriate. Further, the orders provided for Sydney Metro's evidence to be filed five weeks before the date set down for the commencement of the hearing of the Second Separate Questions. It is clear the applicants did not anticipate the position to be adopted by Sydney Metro.
As such, while I accept the submissions made on behalf of the applicants that they are unable to meet the evidence now sought to be relied upon by Sydney Metro, and accepting that they maintain that some (possibly a significant amount) of the evidence sought to be relied upon by Sydney Metro may be irrelevant to the specific questions now before the Court, this position is, to some extent, a result of the applicants' own conduct and, as submitted by Sydney Metro, forensic decisions made by the applicants.
Further, while I note the applicants' submission that they did not anticipate the manner in which Sydney Metro intends to conduct its case, at least until the receipt of further evidence in late February 2020, I am conscious that on a number of occasions the Court was informed at various directions hearings and particularly in the most recent hearings in March before Moore J, that the applicants were not intending to call further evidence in relation to the Second Separate Questions although a possible application to revoke Question 1(a)(ii) was foreshadowed.
Although not determinative, as noted above, I consider the applicants' present position has been brought about by forensic decisions they have earlier made. In those circumstances, I do not consider it appropriate, nor do I consider that it would it be just, quick and cheap, for there to be a preliminary determination in regard to the admissibility of evidence.
For the above reasons, and for the reasons set out below in relation to the further orders sought, I do not make Order (1) sought in the motions.

[8]

Applicants' position

The applicants submit that if the Court determines that the town planning evidence to which they have objected ought to be received, the Court should revoke the hearing of Question 1(a)(ii) as a discrete separate question and that Questions 1(a)(i) and 1(b) should be determined within a "narrow factual compass". In support of that submission, the applicants repeat their submission that when Moore J made and order and gave directions for the hearing of the Second Separate Questions, the parties and the Court were unaware of the facts and the scope of the evidence against which the Second Separate Questions were to be determined, and that it was only in the week commencing 24 February 2020 that the applicants became aware of the basis on which Sydney Metro was approaching the Second Separate Questions and the evidence upon which it sought to rely. The applicants further submit that at the case management hearing on 4 March 2020, they raised their concerns in a document styled "Applicants' Issues for Consideration at the Case Management Hearing on 4 March 2020".
The applicants raise the principles applied in determining whether separate questions are entertained, and emphasise that even if a particular question would not resolve all issues, if the decision will nonetheless obviate unnecessary and expensive hearings of other questions, then it would remain appropriate for preliminary determination. The applicants also remind the Court that where a particular question is common to a number of pending cases, there was more utility in having that question discretely decided.
The applicants submit that, with the benefit of hindsight and having regard to the lack of established facts, the original decision to order the separate determination of the Second Separate Questions may not have been approached with the appropriate caution required, and that unless Question 1(a)(ii) is revoked (and the other separate questions proceed to determination), there would be a possibility of the same witnesses being called at both stages, being the time of the hearing of separate questions and at the final hearing, and therefore there would be a significant overlap between the evidence likely to be adduced in the two stages. Further, if either Questions 1(a)(i) or 1(a)(ii) is resolved in favour of the applicants, the applicants would be entitled to compensation under the Just Terms Act. Conversely, the separate questions do not resolve the proceedings unless Sydney Metro succeeds on both Questions 1(a)(i) and 1(a)(ii). The applicants further submit that Questions 1(a)(i) and 1(b) are questions which are common to a number of pending cases and the answers to those questions are likely to have direct application to most of the other similar cases.
In summary, the applicants submit that, if the Court were to reject the applicants' objections to the evidence specified in Schedule A to the motions, separate Question 1(a)(ii) should be revoked. However, the applicants maintain that Questions 1(a)(i) and 1(b) remain capable of separate determination and such separate determination has real utility because, for example, if the applicants succeed on Question 1(a)(i), the determination of Question 1(a)(ii) becomes otiose. Furthermore, even if Sydney Metro succeeded on Question 1(a)(i), Question 1(a)(ii) can in any event be determined as part of the final hearing. The applicants further contend that the expert evidence in relation to Question 1(a)(i) is, in a broad sense, largely in agreement, that is, it is common ground that there was "ground movement" to the surface of the land (relying upon the joint geotechnical expert report).
The applicants accept that Sydney Metro takes a different view as to how cl 2(1)(a) of Sch 6B is to be construed.
The applicants accept that Question 1(b) requires the legislative framework to be construed and submit that this therefore does not require significant consideration of the factual matrix that underpins the determination of that question. Accordingly, the applicants submit that both Questions 1(a)(i) and 1(b) are capable of separate determination and that, given that the resolution of Question 1(a)(i) may render Question 1(a)(ii) otiose thereby obviating the need to incur significant expense, additional expert evidence and additional Court time in determining that issue, it is desirable that these questions remain to be separately determined.

[9]

Sydney Metro's position

Sydney Metro submits that the Second Separate Questions remain suitable for resolution as separate questions in advance of other issues in the proceedings and that there is no basis to disturb, in the whole or in part, the order of 2 October 2019. Sydney Metro submits that principles relating to the determination of questions separately and before a primary hearing do not indicate that a question is unsuitable for separate determination if it involves contentious facts, and that the relevant principle is that there must be a clear method by which all of the relevant facts can be ascertained either by way of assumed or agreed facts or facts otherwise judicially determined based upon relevant evidence.
Sydney Metro emphasises that the order made on 2 October 2019 for the Second Separate Questions was made by consent and provided a clear method for ascertaining those facts including in relation to Question 1(a)(ii). Sydney Metro points to the requirement that the parties were to confer and attempt to agree assumed or agreed facts and that, in any event, Sydney Metro made it clear that it was always approaching Question 1(a)(ii) by reference to the "load bearing capacity" of the overlying land for future development and, as such, it is not correct for the applicants to submit that they only became aware of Sydney Metro's approach in February 2020 upon receipt of Sydney Metro's evidence (including the disputed evidence). Further, the order made on 2 October 2019 granted leave to the parties to adduce expert evidence in specified disciplines (including town planning, geotechnical, and heritage) and that, even following the service of Sydney Metro's evidence, the applicants made a forensic decision not to seek to rely on town planning evidence.
Sydney Metro rejects the applicants' submission that there will be overlapping factual issues and submits that even if there were, any such overlap (and the extent of any overlap) would depend in part on the answer to Question 1(b). Accepting that by its very nature cl 2(1) of Sch 6B of the Transport Act provides a "jurisdictional gateway" which must be opened before any amount of compensation is payable for the acquisitions, the question of whether the applicants have passed through the gateway is an eminently suitable separate question to be tried in advance of other issues. Sydney Metro submits that it has already filed and served the evidence upon which it relies in relation to the Second Separate Questions and that if those questions do not proceed, the additional evidence required for the final hearing would be substantial.
Sydney Metro also submits that although the applicants point out that the Second Separate Questions do not resolve the proceedings unless Sydney Metro succeeds on both Questions 1(a)(i) and 1(a)(ii), it is for precisely that reason that there remains utility in having both questions determined in advance. Conversely, if only Question 1(a)(i) is determined separately, this would not result in cost savings and if that question was answered in Sydney Metro's favour, it would not be determinative of the proceedings as Question 1(a)(ii) would remain for consideration and therefore result in proceedings being fragmented into even more stages with associated delay and expense. Further, if Question 1(a)(i) were answered in the applicants' favour, while this would render Question 1(a)(ii) otiose, it would not dispose of the proceedings as the compensation question would remain for consideration together with its attendant costs.
Finally, dealing with the compensation question (Question 1(b)) separately and in advance of the final hearing has the advantage that the valuation evidence (should it be required) can be prepared on the correct basis.

[10]

Consideration

Although the parties made detailed submissions in relation to the continuing application of the principles in relation to the exercise of discretion under r 28.2 of the UCPR, I do not consider those principles are determinative in relation to the order presently sought by the applicants that Question 1(a)(ii) be excised from the Second Separate Questions.
Having considered both the detailed written and oral submissions made in relation to the second prayer, while I see some attraction in separating the presently framed questions, I consider that it is inappropriate in the current circumstances to separate Question 1(a)(ii). My reasons may be shortly stated.
First, although the determination of whether one or both "gateways" is open is, as submitted by Sydney Metro, an eminently suitable question for separate determination, I repeat my reasoning above that a cohesive construction ought to be given to cl 2 of Sch 6B as a whole, and that the approach to the interpretation of one limb may affect the approach correctly to be taken to the other.
Second, although I accept that if the Second Separate Questions were determined against the applicants then it would be dispositive of the entire proceedings and thus would avoid substantial time and costs involved in assessing the amount of compensation, and despite the fact that I accept that additional evidence required for the final hearing may be substantial (although as considered below there is no specific evidence to this effect), I nevertheless consider that a concurrent determination of both Questions 1(a)(i) and 1(a)(ii) is more likely to be dispositive than if the questions were to be considered separately over two hearings.
Further, I accept the submission of Sydney Metro, that if only Question 1(a)(i) is determined separately, this would not necessarily result in cost savings because it is obvious that if Question 1(a)(i) was determined in favour of Sydney Metro, Question 1(a)(ii) would effectively remain for consideration together with the compensation question (Question 1(b)) and the associated evidence. This would be to further fragment the proceedings.
These matters aside, while my predisposition remains in favour of a separate hearing because of the "gateway" nature of the dispute as considered earlier in this judgment, I am concerned that the discrete provisions (being two limbs of the same single provision), which employ some common language, should be considered and interpreted together even though they are expressed in a disjunctive manner.
In forming my view, I have adopted a "balancing exercise": Allandale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103; (2013) 195 LGERA 182 at [96]. I take into account that when considering to revoke an order for a separate question, it is appropriate to consider the accepted principles that are applied in determining whether to order a separate question and, as stated above, I do not consider those principles are determinative. I also take into account that the Court usually begins with the proposition that it is ordinarily appropriate that all issues in all proceedings should be disposed of at one time.
To the extent that the applicants repeat their submissions as to the Court's unawareness of the "facts or the scope of the evidence against which the Second Separate Question was to be determined" (applicants' submissions dates 31 March 2020 at (42)), I repeat my response at pars [35]-[39] above to a similar submission earlier made by the applicants. Suffice it to say, I do not accept the submission that the original decision to order a separate determination was not approached "with the appropriate caution required" on the part of the Court.
Given my findings above, the essential question remains whether, in the circumstances, the Second Separate Questions should be revoked in their entirety.

[11]

Revocation of the order for Second Separate Questions

The applicants submit that if the Court does not revoke the order made on 2 October 2019 insofar as it relates to the separate determination of Question 1(a)(ii), the Court should revoke the order completely and the matters proceed to final hearing.
Sydney Metro, repeating and adopting its submissions made in relation to the applicants' second prayer, maintains that the Second Separate Questions remain appropriate for separate determination in their entirety. However, if the Court was not prepared to maintain the order that the Second Separate Questions be heard separately in their entirety, Sydney Metro submits that each of the matters should proceed to final hearing rather than separating them out and hearing part only of the Second Separate Questions as proposed by the applicants.
I note that revocation of the entirety of the Second Separate Questions, while not the preferred outcome of either party, is the only common outcome which the parties submit that, if their prior submissions were not accepted, would then become an appropriate course of action.
For the reasons that follow, I consider that it is appropriate that the order made on 2 October 2019 be revoked and that each matter proceeds to final hearing.
As I have found, the determination of the detailed objections sought in the first prayer of the motions requires determination of the competing constructions of the relevant provisions which form the basis for the Separate Second Questions. As I have noted, the parties have conflicting views as to whether the applicants are able to pass through the jurisdictional gateway which in turn requires, on any view, certain evidence to be received. While Sydney Metro accepts that the Court may need to allow the applicants some time to adduce their evidence (accepting that this will necessitate an adjournment of the present hearing of the Second Separate Questions), Sydney Metro nonetheless maintains the Second Separate Questions should not be reduced or partially revoked. In accordance with my findings, it is clear that absent allowing the applicants time to prepare their evidence in response to Sydney Metro's evidence in the separate question proceedings, the Court would be required to make determinations in relation to this potentially important (and determinative) aspect of the evidence without having yet received the relevant evidence from the applicants. As such, I consider that the hearing on the Separate Second Questions cannot proceed without first allowing the applicants time to put on the evidence they submit has now become necessary to adduce in light of the evidence sought to be relied on by Sydney Metro.
Further, the Court has not received any evidence to substantiate or evaluate the extent of the time or cost saving to the parties if the Second Separate Questions remain. Although I accept that the applicants have indicated the nature and extent of the evidence they anticipate adducing in relation to the Second Separate Questions (Tcpt, 6 April 2020, p 21(5-35)), I nonetheless cannot determine with any precision either the nature and extent of this evidence and/or the likely further costs that would be involved as compared to the cost, expenditure and time in relation to preparation for and conduct of the final hearing. Thus, while I accept the submissions of experienced senior counsel, there is no evidence of the further costs (that is, costs over and above those which have either been expended thus far or are likely to be expended in the preparation and conduct of an adjourned hearing) specifically in relation to the Second Separate Questions, as compared to the costs and expenditure to be necessarily incurred should each of the proceedings proceed to final hearing consequent upon an order revoking the Second Separate Questions order completely.
Irrespective of the above, I nonetheless accept that, in reality, if the matters were to proceed directly to final hearing, the parties are likely to incur further costs primarily (or at least) in relation to valuation and necessarily associated evidence that are unlikely to be insignificant. However, on the basis of the material presently before the Court, and given the obvious significant time and costs expended thus far in this litigation, I do not consider that there will necessarily be a significant saving of time and costs given the fact that, in any event, further evidence will be required and that an adjournment of the hearing of the Second Separate Questions to allow the applicants to marshal evidence is inevitable.
In light of this lack of certainty in relation to savings of time and cost, and considering the extent of the evidence which now appears necessary to marshal in the hearing on the Second Separate Questions, and the time and cost already expended, I consider that the utility of having the gateway determinations dealt with by way of a separate question for determination has, to a significant extent, been lost.
I note that any materials prepared by the parties in contemplation of the hearing of the Second Separate Questions remains applicable to the final hearing in any event, as the final hearing will nonetheless still require submissions on the matters which would have otherwise been heard in the Second Separate Questions proceedings.
The course I propose removes any risk of any potential duplication of evidence (such as cross-examination of experts) in both the preliminary and final hearings.

Opera Australia v Sydney Metro; Kritikos Developments Pty Ltd trading as Iron Duke Hotel v Sydney Metro

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