Owners of Strata Plan 37762 v Pham and Ors

KEY ISSUES: Practice and Procedure :- application for stay of orders requiring demolition of work performed pursuant to invalid consent - consent invalid due to lack of body corporate consent - orders originally postponed to allow opportunity for further development application to be made - order made by Consumer Tenancy and Trading Tribunal requiring body corporate to grant consent to new development application - appeal pending to Supreme Court of order made by CTTT - costs

LEGISLATION CITED: Land and Environment Court Rules Pt 1 r 8

Cretazzo v Lombardi (1975) 13 SASR 4 ; Re Elgindata Ltd (No 2) [1992] 1 WLR 1207 ; CASES CITED: Hughes v Western Australian Cricket Association (Inc) and Ors (1986) 8 ATPR 40-676; Latoudis v Casey (1990) 170 CLR 534

DATES OF HEARING: 06/12/2005 EX TEMPORE JUDGMENT DATE : 12/06/2005

APPLICANT P Tomasetti SOLICITORS Andreones Pty Ltd

FIRST AND SECOND RESPONDENTS LEGAL REPRESENTATIVES: C Norton SOLICITORS Woolf Associates THIRD RESPONDENT P Hudson (solicitor) SOLICITORS Marsdens Law Group

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

JUDGMENT 1 Cowdroy J: On 13 September 2005 the Court delivered judgment in these proceedings. It ordered that development consent DA63/04 ("the consent") granted on 13 October 2003 by Liverpool City Council in respect of lot 5 in Strata Plan number 37762 ("lot 5") be declared invalid. By order No 2 it ordered the respondents be restrained from using a spray booth contained in the above premises without consent being lawfully obtained from Liverpool City Council. By order No 3 the first respondent ("Ms Pham") was ordered to reinstate those parts of the common property which were altered pursuant to the consent to their condition extant prior to their alteration.

2 The Court postponed the effect of order No 2 until 9 December 2005 and order No 3 until 9 January 2006.

3 From before the date of judgment Ms Pham was actively seeking to obtain an order from the Consumer Tenancy and Trading Tribunal ("the CTTT"), requiring the applicant in these proceedings ("the body corporate") to give consent to the lodgement of a new development application in respect of the spray booth. The CTTT has now made its decision and has ordered the body corporate to grant its consent to the lodging of the development application for the spray booth.

4 On 23 November 2005 Studdert J in the Supreme Court, Common Law Division, ordered the orders of the CTTT to be stayed pending further order. Such stay was granted in view of a challenge made by the body corporate against the decision of the tribunal. His Honour ordered the appeal to be expedited and has set the matter down for hearing on 20 February 2006. Resulting from that hearing it is possible that the decision of the CTTT may be set aside. However, if it is not set aside, and the orders are confirmed, it will entitle the first respondent to lodge a development application with Liverpool Council in respect of the spray booth.

5 When this Court pronounced its orders on 13 September 2005 it was aware of the proceedings in the CTTT. It was for that reason that orders Nos 2 and 3 were postponed.

6 This application is now made for a further postponement of orders Nos 2 and 3 because of the possibility that Ms Pham may be able to lodge a development application for the spray booth and remove the need for its demolition. If a stay is not granted the premises will require reinstatement by 9 January 2006.

7 The body corporate opposes the orders sought in the notice of motion. It relies upon affidavits of several of the occupants in the building complex which describe the undesirable consequences of the activity being conducted in lot 5. The Court refers to the affidavits of Bounma Sengmany and John Martin Easton, both sworn on 29 November 2005.

8 In its judgment delivered on 13 September 2005 the Court considered the consequences of the activities being conducted in lot 5. However, the Court was conscious that there was an existing consent which entitled unit 5 in the factory complex to be used for the purpose of smash repairs. Accordingly, the Court was not satisfied that the complaints of the adjoining unit holders were attributable to the conduct conducted pursuant to the invalid consent.

9 It is apparent that the environmental effects of the business in lot 5 are continuing. However, it is also apparent that there remains a possibility that a consent may be granted to the first respondent by Liverpool Council. It would be contrary to the Court's intention reflected in its judgment delivered on 13 September 2005 that the spray booth be dismantled and the premises be reinstated if, within a short time thereafter, a development consent is granted for that activity.

10 For these reasons the Court considers that it is appropriate to extend the time for compliance with the Court's orders. The Court relies upon Pt 1 r 8 as the source of power to extend the orders made on 13 September 2005. Pt 1 r 8 of the Land and Environment Court Rules 1996 relevantly provides: (1) The Court may by order and on terms extend or abridge any time fixed by these rules or by any judgment, decision, or order, of the Court.

11 The body corporate has submitted that the Court is functus officio and may not extend the time for compliance with the orders. However, the Court is clearly entitled by virtue of Pt 1 r 8 to make an order of the kind which is sought.

12 The hearing in the Supreme Court has been fixed for 20 February 2006. A request is made by Ms Pham that the time for compliance be extended until a date in May 2006. The Court does not consider it appropriate to extend the time for such a prolonged period. In this case there is obviously a wholly reasonable desire on the part of the body corporate to bring the matter to finality as soon as possible.

13 In the circumstances, the Court considers that the proceedings should be returnable before the Duty Judge of this Court for mention on Monday 6 March 2006 which is 14 days following the hearing on 20 February 2006. It is possible that a judgment may be delivered by that date. If not the Court can then determine whether a further extension of time is appropriate.

14 The Court varies order No 4 made on 13 September 2005 and substitutes in lieu of the date 9 December 2005 the date of 6 March 2006. The Court also will amend order No 4 by substituting the date 3 April 2006 for the date 9 January 2006. That will hopefully allow sufficient time for the removal and reinstatement following any decision of the Supreme Court.

15 A further question arises as to costs. On 13 September 2005 the Court ordered as follows: 5. Unless a contrary order is sought by 9 December 2005 the first and second respondents pay the applicants costs of these proceedings.

16 By its notice of motion Ms Pham submits that it should not be required to pay for the costs associated with the evidence surrounding the adverse environmental effects which the body corporate claimed resulted from the operations of the spray booth. Such application is made upon the ground that the Court was not satisfied that those effects resulted from the operation of the spray booth because they were consistent with the operation of a lawful use of the premises for the purpose of smash repairs.

17 Much of the time of the Court was taken up by the evidence of the effects of spray painting which is a consequence of a smash repairs business. Ms Pham submits that she was successful in relation to that aspect of the claim and says that such evidence prolonged the hearing unnecessarily. She contends that had it not been for such evidence the Court could have determined the proceedings essentially on the documents and thereby a hearing of that length would have been avoided. The body corporate submits that the evidence was essential in order for the Court to consider necessary aspects of discretion.

18 Apportionment of costs against a successful party should only be made in exceptional circumstances lest the ultimate ends of justice be prevented because a party is dissuaded from canvassing all issues: see Cretazzo v Lombardi (1975) 13 SASR 4 at 16, followed by Toohey J in Hughes v Western Australian Cricket Association (Inc) and Ors (1986) ATPR 40-676. In Re Elgindata Ltd (No 2) [1992] 1 WLR 1207 Nourse LJ said (at 1214): The general rule does not cease to apply simply because a successful party raises issues or makes allegations on which he fails, but where that has caused a significant increase in the length or cost of a proceedings he may be deprived of the whole or a part of his costs.

19 The usual rule is that costs ordinarily follow the event: see Latoudis v Casey (1990) 170 CLR 534. The issue of discretion was a matter which the Court had to determine. The Court is satisfied that the hearing was prolonged by the extensive evidence concerning those issues. Had it been conducted solely on documentary evidence the hearing would have been substantially reduced. Nevertheless some of the affidavit evidence was necessary to enable the Court to be fully informed of all the relevant facts.

20 Ms Pham has itemised the list of affidavits which it claims were unnecessary and for which it should not be required to pay costs. The number of affidavits is voluminous but the Court finds that the consideration of those matters was necessary. The Court considers an order should only be made if the evidence adduced by those deponents was wholly unnecessary.

21 The Court accepts, however, that there was a degree of duplication in the affidavit evidence concerning the adverse effects of the business conducted in lot 5. It is impossible to assess with precision the costs of that duplication. However, the Court is prepared to make a determination which it considers reflects an appropriate allowance.

22 In lieu of order 5 of the Court's orders of 13 September 2005, the Court will order Ms Pham and the second respondent to pay the applicant's costs of the proceedings except for an amount of $1,000 representing the duplication of the costs concerning the alleged environmental effects resulting from the business.

23 An application for costs is made by Ms Pham and by the applicant for costs of this motion. Although the Court has acceded to the orders which are sought by Ms Pham in the proceedings, the Court considers that an indulgence has +been sought from the Court in two respects. In the circumstances the Court considers that the first and second respondents should pay the costs of this motion. They are seeking orders which are essential to avoid compliance with the orders of this Court by 9 December 2005 and 9 January 2006.

24 Accordingly, the court makes the following orders: 1. Order 4 made on 13 September 2005 is varied by deletion of the date 9 December 2005 and the substitution of the date 6 March 2006, and by deletion of the date 9 January 2006 and substitution of the date 3 April 2006.

2. Order 5 is deleted and in lieu the following order is made: The first and second respondents pay the applicant's costs of these proceedings less the sum of $1,000. 3. The proceedings are to be listed for mention before the Duty Judge on Thursday 2 March 2006 for any application for a variation of the existing orders.

4. The first respondent is to pay the applicant's costs of this motion.

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