Pastoral Investment Land & Loan Pty Ltd v Central Coast Council [2020] NSWLEC 85 | Case summary

Misdirection, misconstruction and misapplication of r 12.7

Rule 12.7(1) of the UCPR provides: "If a plaintiff does not prosecute the proceedings with due despatch, the court may order that the proceedings be dismissed or make such other order as the court thinks fit."
Pastoral submitted that, for the rule to apply, the court must find a want of prosecution with due despatch - the discretionary power to summarily dismiss the proceedings is engaged only "if the plaintiff does not prosecute the proceedings with due despatch". Pastoral submitted that there needs to be a relevant failure to prosecute the proceedings that results in delay sufficient to attract the operation of r 12.7: Sandra Lazarus, Michelle Lazarus and Jessica Lazarus v Director of the Independent Commission Against Corruption (No 2) [2015] NSWSC 1390 at [9].
In this case, Pastoral submitted, it cannot be said that Pastoral has not prosecuted its case with due despatch. Pastoral had prosecuted its appeal to the stage of final hearing. The final hearing had been fixed by the Court six months beforehand. The final hearing had commenced on the first day fixed and was being run. The Senior Commissioner's decision, on her own motion, to dismiss the proceedings occurred at the end of the first day of the final hearing.
The only "default" by Pastoral in the preparation of its case relied upon by the Senior Commissioner was the failure of Pastoral to have obtained a statement of evidence of its ecological expert undertaking an assessment under s 5A of the EPA Act of whether the proposed development of clearing native vegetation was likely to significantly affect identified threatened species of fauna, in particular, two threatened species of owl. Whilst Pastoral had sought an adjournment of the hearing to allow for its ecological expert to undertake such an assessment, the failure to have done so earlier was not a "default" of Pastoral in not complying with any direction of the Court. The Court's directions to file and serve evidence were general in nature and did not specifically require filing and serving an assessment of significance for any particular threatened species. Pastoral's ecological expert had conferred with the Council's ecological expert and had produced a joint expert report. It was only in that joint expert report that Pastoral's ecological expert had noted that an assessment of significance had not been carried out for two threatened species of owl. This was said by the expert to have been "purely an oversight" and that he would complete an assessment of significance for the two threatened species of owl.
Pastoral, in its application for an adjournment of the hearing, did say that its ecological expert's acknowledgment that he had overlooked undertaking an assessment of significance for the two owls "creates a massive hole for us" in Pastoral's evidence on the issue of the likely significance of any impact of the development on the two owls and that the lack of an assessment of significance on the two owls "would be fatal to our application" and "the fact that they are not currently addressed and a view is expressed about them on the other side is fatal." (quoted by the Senior Commissioner in [14] of the judgment).
Pastoral's application for an adjournment of the hearing was refused by the Senior Commissioner. That meant that Pastoral needed to run its case on the basis of the ecological evidence that it had already filed, the joint expert report, and any evidence in chief and cross-examination of the parties' respective ecological experts. Pastoral submitted that the fact that it had not obtained an assessment of significance for the two owls was not a default in its prosecution of the appeal with due despatch.
However, even if it could be seen to be a default, it did not result in any delay. The proceedings had been fixed for final hearing and the final hearing was being run. Pastoral's application for an adjournment of the final hearing had been refused by the Senior Commissioner. The final hearing would therefore continue to be run as fixed.
Pastoral submitted that the Senior Commissioner's summary dismissal of the appeal for want of prosecution did not achieve either of the two purposes of r 12.7 as identified by Mason P in Fairey v Fairey (No 2) [2000] NSWCA 173 at [52]: "The power to dismiss proceedings summarily serves the dual purposes of ensuring fairness to litigants and preserving the integrity of the judicial system. The former purpose aims essentially to protect the litigant, in this case the respondent, from the consequences of delay, be those consequences financial, impacts on litigation, psychological or otherwise. The latter purpose, namely the integrity of the judicial system promotes the expedient resolution of cases and has some regard to the interests of litigants generally in the Court. I hasten to say that regard cannot over-reach the rights of the individual litigants to justice in their own case."
No prior complaint had been made by the opposing party to the appeal, the Council, that Pastoral had not prosecuted its appeal with due despatch or that the Council had suffered any consequence as a result of any delay in the appeal coming on for final hearing. Summary dismissal of the appeal was, therefore, not necessary in order to protect the Council from any consequence of delay.
Summary dismissal of the appeal was also not necessary to protect the integrity of the judicial system. Conversely, Pastoral submitted, the summary dismissal of the appeal undermined the integrity of the judicial system. Pastoral submitted that the dismissal of the appeal at the final hearing denied Pastoral its day in Court. An order for dismissal of proceedings should only be made for the clearest of defaults by a plaintiff, certainly not for some issue about delay in obtaining an expert report. Furthermore, an order for dismissal of proceedings should only be made where it is a proportionate response to the relevant default that causes delay, citing Singh v Singh [2017] NSWCA 15 at [25] and In the matter of Punters Show Pty Ltd [2017] NSWCA 605 at [36].
Pastoral submitted that "it is almost inconceivable" that r 12.7 can ever apply at the final hearing. If a party is guilty of delay or has omitted to act as required or directed by the Court, these actions or omissions will have prevented the proceedings from being prosecuted to a final hearing, to the prejudice of the opposing party. Pastoral submitted that: "The Parties by agreeing to have the matter set down for final hearing are declaring to the Court (and the Court accepts) that there is no default or defect on the pleaded case, that would prevent the determination of the case at that final hearing, on its merits. The merits or otherwise are a matter for trial. However, in the normal course it is submitted it is virtually impossible to envisage circumstances where the Rule could have application at final hearing. This is not such a case."
Pastoral submitted that even if the conditions for the application of the rule are established (that is, the plaintiff has failed to prosecute the proceedings with due despatch), the Court has a discretion whether to exercise the power to dismiss the proceedings. The discretion to dismiss proceedings is broad and should not be confined by rigid formulae: Ghosh v NineMSN (2015) 90 NSWLR 595; [2015] NSWCA 334 at [40]. There are a number of discretionary considerations to be considered. Pastoral cited the general statement in Singh v Singh at [25]: "So far as the principles to be applied by Simpson JA are concerned, we note that the application was not one for dismissal under UCPR r 12.7 on the general basis of "want of due dispatch" (although the analogous words "want of prosecution" appeared in the dismissal motion) but was expressly stated to be an application under s 61(3) of the Civil Procedure Act. We have mentioned earlier that this is concerned only with non-compliance with directions made by court order. Nevertheless, certain discretionary considerations will be relevant to both classes of application. In particular, the Court must consider and assess any explanation proffered for default or delay and must consider the likely impact of an order dismissing proceedings. Where, as here, the dismissal is likely to be effectively final, the Court must consider whether dismissal of the proceedings is a proportionate response to the claimant's defaults."
Pastoral also relied on the principles listed by Simpson J in Hoser v Hartcher [1999] NSWSC 527 at [19], which are relevant to the exercise of the discretion to dismiss proceedings for want of prosecution. These principles include: 1. The ultimate question is whether, on balancing the prejudice to the respective parties by making or not making the order, justice demands that the proceedings be dismissed; 2. The discretion should be exercised only in a clear case where it is manifestly warranted; 3. Any explanation offered by the plaintiff for the delay in prosecuting the proceedings must be considered; 4. Personal blamelessness on the part of the plaintiff (as distinct from any tardiness or fault on the part of the plaintiff's legal representative) is relevant; 5. A defendant who takes no steps to secure progress in the proceedings, or to activate an apparently inactive plaintiff, or who stands by in the hope that the passage of time will ensure the quiet death of the proceedings or that the longer delay will strengthen the case for striking out runs the risk that that very behaviour will operate to its disadvantage. A defendant having done nothing to progress the matter can hardly be heard to complain of the plaintiff's earlier inactivity; 6. Delay between the date the cause of action arose and the commencement of the proceedings may be a relevant factor, but the weight that can be afforded to that delay is limited. The real question is not the length of the initial delay but the impact that delay has upon the defendant's capacity properly to defend the plaintiff's claim. 7. The onus lies on the defendant to establish prejudice upon which reliance is placed. 8. Prejudice to a defendant caused by delay has to be balanced against prejudice to a plaintiff deprived of an otherwise valid claim. 9. What the defendant has (or has not) done by way of preparation for trial may be a factor. This is a distinct question from that concerning any steps taken (or not taken) by the defendant in prompting the plaintiff to action. 10. The plaintiff's prospect of success is a relevant factor. If it appears that the prospects are minimal, the discretion is more likely to be exercised in favour of the defendant. Conversely, where the plaintiff's case is strong, it is less likely that justice will be done by striking the action out. 11. The exercise of the discretion to strike out should not incorporate any element of punishing a tardy plaintiff, or of excluding one who may appear to have some unworthy characteristics. The discretion to strike out proceedings for want of prosecution ought not to be used to supplant the overall aim of the attainment of justice.
Pastoral noted that a common theme in all of these factors is that the plaintiff, by not progressing the proceedings to the final hearing, has caused prejudice to the defendant. The Court must strike a balance between the respective prejudices to the plaintiff and defendant by dismissing or not dismissing the proceedings. As Ward J held in Weston v Publishing and Broadcasting Ltd (2011) 83 ACSR 206; [2011] NSWSC 433 at [501]: "The ultimate question (keeping in mind the overriding purposes mandated by ss 56-59 of the Civil Procedure Act ) is whether, balancing the prejudice to the respective parties by making or not making an order dismissing the proceedings, justice demands that the action be dismissed ( Hoser v Hatcher [1999] NSWSC 527 at [20]; Witten at [411]; Stollznow; Southern Cross Exploration NL v Fire & All Risks Insurance Co Ltd (1986) 4 NSWLR 491; McKenna v McKenna [1984] VR 665; Hartigan v International Krishna Consciousness [1999] NSWSC 57; Ritchie's Commentary on Uniform Procedure Rules at [12.7.5])."
Pastoral submitted that the Senior Commissioner did not come close to considering the Hoser type factors. The discretion to dismiss proceedings for want of prosecution should be exercised only after considering the Hoser type factors, and even then "only in a clear case" (Weston v Publishing and Broadcasting Ltd at [503]).
Pastoral submitted that consideration of the Hoser type factors revealed that they were inapplicable to the facts of this case. In particular, there was no prejudice to the Council. The Council had filed and served its ecological evidence. The final hearing had commenced with the site inspection. The Council's ecological expert attended the site inspection. The hearing had continued in Court. The Council's witnesses were at the Court ready to give evidence. Allowing the hearing to have continued would have caused no prejudice to the Council. Indeed, the Council had opposed Pastoral's application for adjournment of the hearing. The Council had wanted the hearing to continue.
On the other hand, summarily dismissing the proceedings denied both parties the opportunity for the appeal to be heard. This denied Pastoral its day in court and finally disposed of its appeal, thereby denying Pastoral the opportunity to persuade the Court that consent should be granted for the native vegetation clearing and other site works that the Council had refused.
Pastoral also referred to the factor that there was a lack of personal blamelessness on its part that should be taken into account. The omission to prepare an assessment of significance for the two threatened species of owl was entirely the fault of Pastoral's ecological expert. Pastoral was not responsible. It only was advised of the ecological expert's oversight in the joint expert report filed two days before the commencement of the hearing (the joint expert report was filed on 9 March 2020 and the hearing commenced on 11 March 2020).
The Council defended the Senior Commissioner's dismissal of the proceedings, although it had not applied at the hearing for such an order.
The Council noted that Pastoral's appeal is against the exercise of a discretion and is to be determined according to established principles, summarised in House v The King (1936) 55 CLR 499 at 504-505; [1936] HCA 40. Here, Pastoral is merely dissatisfied with the manner in which the Senior Commissioner exercised her discretion in dismissing the proceedings pursuant to r 12.7. Such dissatisfaction cannot, without more, amount to an error on questions of law.
The Council accepted that if the Senior Commissioner had misconstrued or misapplied r 12.7, or misdirected herself on its application, this would be an error on a question of law. However, the Council submitted that Pastoral had not established that the Senior Commissioner did so err in exercising the discretionary power under r 12.7 to dismiss the proceedings.
The Council submitted that the requirement in r 12.7 that a plaintiff not "prosecute the proceedings with due despatch" refers not only to the plaintiff not taking some action that is required or directed without delay ("with due despatch") but also to not taking the very action that is required or directed by the Court in order properly to prepare the plaintiff's case ("prosecute the proceedings").
In the present case, the Council argued, the Council had raised in its statement of facts and contentions, both the original statement filed on 17 January 2019 and the amended statements filed on 16 August 2019 and 4 February 2020, an issue that there had been insufficient assessment of the ecological values of the site. The Council had particularised the need for fauna surveys and investigations, in accordance with the Council's Flora and Fauna Survey Guidelines, with respect to four threatened species of fauna, including two threatened species of owl. The Council submitted that Pastoral was thereby put on notice that the Council contended that Pastoral had undertaken insufficient assessment of the likely impact of the proposed development on the identified threatened species of fauna.
The Council next referred to Pastoral's ecological expert's "admission" that he had omitted to carry out an assessment of significance for the identified threatened species of owl.
The Council submitted that such an assessment was necessary in order for the decision maker, here the Senior Commissioner, to determine whether there was likely to be a significant impact on those threatened species of fauna. If that assessment had been carried out and if it had shown that there was likely to be a significant impact on any or all of the threatened species, then consent could not be granted unless the Court had before it a species impact statement under the former s 78A(8)(b) of the EPA Act. No species impact statement had been prepared.
The Council noted that Pastoral's counsel had submitted to the Senior Commissioner that the ecological expert's acknowledgement that he had not prepared, but will need to complete, an assessment of significance for the two threatened species of owl "creates a massive hole for us" and "are matters which would be fatal to our application". The Council submitted that Pastoral hereby acknowledged that its preparation of its case was insufficient; Pastoral had not obtained evidence that was so critical for its case that its absence was fatal to Pastoral's application before the Court.
The Council contended that Pastoral had been on notice that such an ecological assessment was needed but had delayed in preparing it and had sought an adjournment of the hearing in order to be able to complete it. As a consequence, the Council submitted that Pastoral had not prosecuted the proceedings with due despatch.
The Council submitted that this is what the Senior Commissioner decided. Although the Senior Commissioner only referred to r 12.7 in [37] of the reasons for judgment, the Council submitted that the reasons given earlier for the Senior Commissioner's decision to refuse the adjournment application were of relevance to her decision to dismiss the proceedings for Pastoral's failure to prosecute the proceedings with due despatch.
One of the reasons give by the Senior Commissioner at [37] was that "without the ecological assessment, the appeal cannot proceed". The Senior Commissioner had earlier referred to the Council's submission that "in the absence of the assessment of significance of the Sooty Owl, the Powerful Owl and the froglet and the squirrel glider, all threatened species, the Council is unable to grant consent under the Environmental Planning and Assessment Act 1979 (EPA Act). This is a threshold issue going to jurisdiction because I do not know if I need a species impact statement" (at [29]). The Senior Commissioner recorded that "the applicant's ecologist acknowledges that assessments of significance…have not been provided for the locally occurring threatened species and that they need to be carried out" (at [30]). The Senior Commissioner noted that: "While the applicant says it can carry out the relevant surveys within 6 weeks, this will necessitate a response from the Council and the likelihood is this part heard matter will be delayed for months before allocation of a date before me given the current hearing allocations." (at [31]).
The Senior Commissioner concluded that Pastoral had delayed too long in preparing these needed assessments of significance: " It is my considered opinion that it is all too little too late. The proceedings were commenced in this Court on 5 November 2018. The Court file records several variations to the timetable for evidence in this case. For example, the Court had on 6 August 2019, directed that any flora and fauna surveys be completed by 30 November 2019. Further time was provided in an order made in February when it was directed that the applicant file and serve the flora and fauna surveys it relies upon by 7 February. As it happened, the ecological evidence was prepared on 5 March following a teleconference and filed on 9 March 2020. Yet, it was only halfway through the first day of the hearing that the applicant asked for this adjournment - having been on notice of the "hole" in the ecological evidence since 5 March." (at [32]).
The Senior Commissioner decided that Pastoral's delay in preparing the assessments of significance not only "founds a refusal [of] the adjournment of this three day hearing", it justifies the dismissal of the proceedings: "The applicant's delay in making the application for an adjournment founds a refusal of the adjournment of this 3 day hearing. Together with the jurisdictional impediment identified by the ecologist in the joint report, there is no utility in proceeding with this hearing today. The absence of the requisite ecological survey is fatal to the consent of application." (at [33]).
The Senior Commissioner referred to the obligation in s 56 of the Civil Procedure Act 2005 "to facilitate the proper (just), expeditious (quick) and least expensive (cheap) resolution of the proceedings" (at [34]). The Senior Commissioner noted that, when she considered the case management of the matter since the appeal was lodged in 2018, and the issues recorded within the various statements of facts and contentions, she was satisfied that "the issues in this case have been clearly defined for several months and the applicant has been given more than sufficient time to prepare its case. There needs to be a timely resolution of this appeal and.. it would be wrong to adjourn this matter during the hearing" (at [34]). The Senior Commissioner found that "the extensive time required to carry out the critical surveys to enliven my jurisdiction to deal with this matter is not justified" (at [35]).
The Senior Commissioner noted that Pastoral's counsel had described the missing ecological evidence as a "massive hole" in Pastoral's case. The Senior Commissioner considered that "it could not be assumed that the 'massive hole' could be filled by the surveys yet to be undertaken. If those surveys were to establish a relevant impact on the threatened species the application would be incompetent because a species impact statement would be required." (at [36]).
The Council submitted that this reasoning supports the Senior Commissioner's finding in [37] that Pastoral had not prosecuted its proceedings with due despatch. The Council submitted that the missing ecological evidence was necessary to "overcome the jurisdictional threshold" of establishing that the development was not likely to significantly affect the threatened species, so that the Court could grant development consent. The Council submitted that "a three day hearing would simply have been a waste of time where the Court was not able to reach that jurisdictional threshold" (Respondent's outline of submissions, [19(4)]).
The Council submitted that the Senior Commissioner's application of r 12.7 was proper: "The proper approach to the exercise of a power under r 12.7 of the UCPR is to determine whether in all the circumstances, justice requires that the proceedings be dismissed. This necessarily involves striking a balance between the interests of both parties, as well as taking into account more general considerations concerning the efficiency of the Court's proceedings and the Court's operations" (Respondent's outline of submissions, [27]).
The Council submitted that this was what the Senior Commissioner said and did, as evidenced in [34] of the judgment.
The Council submitted that, whilst the Senior Commissioner did not expressly refer to factors of the kind stated in Hoser v Hartcher, she did refer to the terms of ss 56-60 of the Civil Procedure Act 2005. The Council noted that, since the time of Hoser v Hartcher, the Civil Procedure Act has come into operation and the stringency of the principle that a court should be reluctant to exercise the power of summary dismissal without a hearing on the merits has been diminished by ss 56-60 of the Civil Procedure Act: State of New South Wales v Plaintiff A [2012] NSWCA 248 at [17]. The Council submitted that the list of factors in Hoser v Hartcher are not exhaustive and do not necessarily apply in all circumstances, citing Pacanowski v Simon Wakeman and Associates [2009] NSWCA 402 at [26]. The surest guide to the exercise of the discretion under r 12.7 is careful attention to the terms of ss 56-60 of the Civil Procedure Act: Bi v Mourad [2010] NSWCA 17 at [49]. This is what the Senior Commissioner did, as evidenced by [34] of the judgment.
I consider that the Senior Commissioner did err on questions of law in dismissing the proceedings by misconstruing and misapplying r 12.7 and misdirecting herself on its application.
First, the Senior Commissioner misdirected herself in applying r 12.7. Critical to the Senior Commissioner's decision to dismiss the proceedings for want of prosecution with due despatch was the Senior Commissioner's finding that "without the ecological assessment, the appeal cannot proceed" (at [37]). The ecological assessment referred to was the assessment of significance under s 5A of the EPA Act for the identified threatened species of fauna, including the two threatened species of owl.
The Senior Commissioner had accepted the Council's submission that the absence of this assessment of significance was a "jurisdictional impediment" (at [33]). This was said to be "a threshold issue going to jurisdiction" because, without the assessment of significance, "I do not know if I need a species impact statement" (at [29]). If the assessment of significance was to establish that a species impact statement was required, "the application would be incompetent" (at [36]). The Senior Commissioner considered that having the assessment of significance was necessary "to enliven my jurisdiction to deal with the matter" (at [35]). Hence, "the absence of the requisite ecological survey [the assessment of significance] is fatal to the consent of application [sic]" (at [33]).
It was on this basis that the Senior Commissioner determined that Pastoral had not prosecuted the proceedings with due despatch. The Senior Commissioner considered that Pastoral had not obtained, by the time of the hearing of the appeal, the requisite assessment of significance to enliven the Court's jurisdiction to determine Pastoral's development application the subject of the appeal before the Court. The Senior Commissioner considered that Pastoral, if it had been prosecuting its appeal with due despatch, should have obtained this assessment of significance by the time of the hearing of the appeal. Its failure to do so, therefore, was a failure to prosecute the appeal with due despatch.
The error in this reasoning is that any assessment of significance under s 5A of the EPA Act is not jurisdictional. The absence of an assessment of significance does not render the development application or the appeal incompetent. The presence of an assessment of significance under s 5A of the EPA Act does not enliven the jurisdiction of the consent authority, or the Court on appeal exercising the functions of the consent authority, to determine the development application. The Senior Commissioner erred in law in construing the statutory regime otherwise.
Pastoral lodged its development application with the Council around November 2017. At that time, the Threatened Species Conservation Act 1995 and the provisions of the EPA Act dealing with the assessment of threatened species, populations and ecological communities, and their habitats, had been repealed by the Biodiversity Conservation Act 2016, which came into effect on 25 August 2017. However, under Sch 9 of the Biodiversity Conservation Act and cll 27 and 28 of the Biodiversity Conservation (Savings and Transitional) Regulation 2017, the former planning provisions of the EPA Act continued to apply to a pending or interim planning application for development consent under Pt 4 of the EPA Act made within three months of 25 August 2017. Pastoral's development application had been lodged within this time period, with the result that the former planning provisions continued to apply.
One of these former planning provisions, s 78A(8)(b) of the EPA Act, provided that a development application must be accompanied by: "If the application is in respect of development on land that is, or is part of, critical habitat or is likely to significantly affect threatened species, populations or ecological communities, or their habitats - a species impact statement in accordance with Division 2 of Part 6 of the Threatened Species Conservation Act 1995."
Another of the former planning provisions, s 5A, set criteria to be evaluated in deciding whether a development is likely to significantly affect threatened species, populations or ecological communities or their habitats. Section 5A at the relevant time provided: "(1) For the purposes of this Act and, in particular, in the administration of sections 78A, 79B, 79C, 111 and 112, the following must be taken into account in deciding whether there is likely to be a significant effect on threatened species, populations or ecological communities, or their habitats: (a) each of the factors listed in subsection (2), (b) any assessment guidelines. (2) The following factors must be taken into account in making a determination under this section: (a) in the case of a threatened species, whether the action proposed is likely to have an adverse effect on the life cycle of the species such that a viable local population of the species is likely to be placed at risk of extinction, (b) in the case of an endangered population, whether the action proposed is likely to have an adverse effect on the life cycle of the species that constitutes the endangered population such that a viable local population of the species is likely to be placed at risk of extinction, (c) in the case of an endangered ecological community or critically endangered ecological community, whether the action proposed: (i) is likely to have an adverse effect on the extent of the ecological community such that its local occurrence is likely to be placed at risk of extinction, or (ii) is likely to substantially and adversely modify the composition of the ecological community such that its local occurrence is likely to be placed at risk of extinction, (d) in relation to the habitat of a threatened species, population or ecological community: (i) the extent to which habitat is likely to be removed or modified as a result of the action proposed, and (ii) whether an area of habitat is likely to become fragmented or isolated from other areas of habitat as a result of the proposed action, and (iii) the importance of the habitat to be removed, modified, fragmented or isolated to the long-term survival of the species, population or ecological community in the locality, (e) whether the action proposed is likely to have an adverse effect on critical habitat (either directly or indirectly), (f) whether the action proposed is consistent with the objectives or actions of a recovery plan or threat abatement plan, (g) whether the action proposed constitutes or is part of a key threatening process or is likely to result in the operation of, or increase the impact of, a key threatening process. (3) In this section: assessment guidelines means assessment guidelines issued and in force under section 94A of the Threatened Species Conservation Act 1995 or, subject to section 5C, section 220ZZA of the Fisheries Management Act 1994. key threatening process has the same meaning as in the Threatened Species Conservation Act 1995 or, subject to section 5C, Part 7A of the Fisheries Management Act 1994."
Insofar as there is a jurisdictional requirement in these former planning provisions, it is in s 78A(8)(b) and not in s 5A of the EPA Act. A development application must be accompanied by a species impact statement if the application is in respect of development that is likely to significantly affect threatened species, populations or ecological communities, or their habitats. This requirement is a jurisdictional fact, satisfaction of which is an essential prerequisite to granting consent to a development application. If a species impact statement is required, but it has not been prepared, consent cannot be granted: Timbarra and Protection Coalition Inc v Ross Mining NL (1999) 46 NSWLR 55; [1999] NSWCA 8 at [94], [108].
Section 5A did not establish a separate jurisdictional fact. Rather, s 5A assisted a consent authority in deciding the jurisdictional fact under s 78A(8)(b) of whether the development was likely to have a significant effect on threatened species, populations or ecological communities, or their habitats, so as to require a species impact statement. Although a consent authority needed to take the factors in s 5A into account in making that decision, it was not limited to considering these factors but could take into account other facts and circumstances relevant to the question of whether the development was likely to significantly affect threatened species, populations or ecological communities, or their habitats: Newcastle and Hunter Valley Speleological Society Inc v Upper Hunter Shire Council (2010) 210 LGERA 126; [2010] NSWLEC 48 at [85].
Importantly, s 5A did not require an applicant for development consent to prepare and to lodge with its development application an assessment of significance under s 5A of the likely impact that the proposed development might have on threatened species, populations or ecological communities, or their habitats. The only document that s 78A(8)(b) required to accompany a development application was a species impact statement, and then only if the development was likely to have a significant effect on threatened species, populations or ecological communities, or their habitats.
The Senior Commissioner therefore erred in law in holding that the absence of an assessment of significance under s 5A of the EPA Act was a jurisdictional impediment and fatal to the Court being able to grant consent to the development application or, conversely, that the presence of an assessment of significance under s 5A was necessary to enliven the Court's jurisdiction to determine the development application.
This misdirection was material to and vitiates the Senior Commissioner's decision that Pastoral had not prosecuted its appeal with due despatch.
Secondly, the Senior Commissioner failed to ask the right question and asked herself the wrong question in applying r 12.7. The rule is concerned with want of due despatch in the prosecution of proceedings by a plaintiff. Delay in prosecuting the proceedings is the threshold circumstance that enlivens the power under r 12.7 to dismiss the proceedings summarily. The rule assumes the plaintiff might have an intention to bring the proceedings to a final hearing, but for whatever reason the plaintiff has not done so. The proceedings still have not progressed to a final hearing.
In the present case, the proceedings had been prosecuted to a final hearing. The hearing had commenced. True, Pastoral had applied to adjourn the hearing to obtain further evidence, but that application was refused. Hence, the hearing would continue as fixed and Pastoral would have needed to present its case at the hearing.
The Senior Commissioner failed to identify how, in circumstances where the proceedings had been prosecuted to a final hearing and the application for adjournment of the hearing had been refused, there could be any failure to prosecute the proceedings with due despatch. The Senior Commissioner's finding that Pastoral had not obtained the assessment of significance under s 5A for the identified threatened species was not a relevant default justifying a finding that the proceedings had not been prosecuted with due despatch, as the finding involved misdirection for the reasons given earlier.
Moreover, the absence of an assessment of significance did not cause any delay. The final hearing had been fixed and was being conducted, notwithstanding that Pastoral's ecological expert had not carried out an assessment of significance for the identified threatened species. The Senior Commissioner had refused the application for adjournment to allow for the assessment of significance to be carried out. The hearing was set to continue without the assessment of significance. Any default in obtaining the assessment of significance did not cause any delay in the prosecution of the proceedings to final hearing.
Thirdly, the Senior Commissioner asked herself the wrong question and failed to ask herself the right question in relation to the case management principles in ss 56-60 of the Civil Procedure Act. The Senior Commissioner noted that she had "an obligation to ensure that the dispute is resolved justly, quickly and cheaply" (at [37]) and referred to this obligation in s 56(1) of the Civil Procedure Act (at [34]). In order to do this, the Senior Commissioner noted, "the Court must act in accordance with the dictates of justice: s 57 of the CPA" (at [34]). The Senior Commissioner considered that "there needs to be a timely resolution of this appeal" (at [34]). The Senior Commissioner considered that "in the interests of justice and having regard to the objects of case management, late amendment of an application as proposed in this instance…it would be wrong to adjourn the matter during the hearing" (at [34]).
The Senior Commissioner properly took into account these considerations in her decision to refuse the application for adjournment of the hearing. However, the Senior Commissioner did not explain how these considerations were relevant to her decision to dismiss the proceedings for failure to prosecute the proceedings with due despatch. Whilst these considerations under ss 56-60 of the Civil Procedure Act "are of fundamental importance in determining an application for the dismissal of proceedings for want of due despatch" (Ghosh v NineMSN Pty Ltd at [43]), they must be applied to the particular circumstances of the proceedings and the plaintiff's prosecution of the proceedings.
In this case, the considerations did not support summary dismissal of the proceedings. Once the adjournment was refused, the hearing would continue as fixed. There would be no delay in the "timely resolution" of the appeal; the dispute would be "resolved justly, quickly and cheaply". Summary dismissal of the proceedings at the hearing would not better ensure the timely resolution of the appeal or the just, quick and cheap resolution of the appeal. To the contrary, the summary dismissal of the proceedings has delayed the resolution of the dispute and has increased the costs to the parties. The Senior Commissioner failed to address these questions.
Fourthly, the Senior Commissioner, in exercising the power under r 12.7, failed to ask the question of whether any want of prosecution with due despatch had caused any prejudice to the Council. Whilst delay in the prosecution of proceedings to final hearing is a threshold circumstance to enliven the power, a key justification for exercising the power is that the delay has caused prejudice to the opposing party.
In the present case, the Council raised no complaint about any want of prosecution of the proceedings by Pastoral with due despatch or that it had suffered or would suffer any prejudice as a result of any want of prosecution with due despatch. The appeal was fixed by the Court for hearing some six months before it commenced on 11 March 2020. No complaint was made by the Council at the time or afterwards about the date on which the hearing was fixed to commence. At no time did the Council make any application that the proceedings be dismissed for Pastoral's failure to prosecute the proceedings with due despatch. At the hearing, the Council did oppose Pastoral's application to adjourn the hearing; the Council's position was that the hearing should continue as fixed. The Council did not apply for the proceedings to be dismissed for want of prosecution with due despatch. The Council did not claim that it had suffered any prejudice by the proceedings being heard on the dates fixed. The only prejudice raised by the Council was if the proceedings were to be adjourned. Once the Senior Commissioner decided not to adjourn the hearing, this potential prejudice fell away.
The Senior Commissioner failed to ask whether the Council had any complaint about Pastoral's prosecution of the appeal without due despatch or whether the Council claimed that it had suffered any prejudice as a consequence of Pastoral's prosecution of the appeal. These matters were fundamental to the exercise of power under r 12.7 to dismiss the proceedings.
Fifthly, the Senior Commissioner failed to ask the question of whether exercise of the power under r 12.7 to dismiss the proceedings would prejudice Pastoral. Clearly, dismissal of the proceedings would prejudice Pastoral. Pastoral had a right to appeal under s 8.7 of the EPA Act against the Council's grant of consent to only part of the development for which consent had been sought. That appeal had to be brought within a specified period of time. Once the right of appeal was exercised within that time, it could not be exercised again. Pastoral could not re-exercise the right of appeal after the proceedings were dismissed for want of prosecution with due despatch. The dismissal of the proceedings effectively finally disposed of the subject matter of the appeal, being Pastoral's dissatisfaction with the determination of the development application to approve only some but not all of the development for which consent had been sought.
In considering the prejudice to Pastoral, there was a need to, but the Senior Commissioner failed to, have regard to the nature and extent of the delay caused by the default relied on by the Senior Commissioner (the absence of an assessment of significance for identified threatened species of fauna), any explanation given by Pastoral for the delay and the default, and Pastoral's lack of personal fault for the delay and default (the reason being Pastoral's ecological expert had overlooked the need to prepare the assessment of significance). The Senior Commissioner failed to enquire of Pastoral regarding, and failed to consider, such matters in order to evaluate the prejudice to Pastoral of dismissing its appeal.
Sixthly, the Senior Commissioner failed to ask the ultimate question of whether, on balancing the prejudice to the respective parties by dismissing or not dismissing the proceedings, justice demanded that the proceedings be dismissed: Stollznow v Calvert (1980) 2 NSWLR 749; [1980] at 751; Hoser v Hartcher at [19]. The Senior Commissioner, having failed to ask whether either the Council or Pastoral would suffer prejudice if the proceedings were not to be or were to be dismissed respectively, could not and did not consider the balance that ought to be struck between the Council and Pastoral, and whether or not on balance justice demanded that the appeal should be dismissed.
Finally, the Senior Commissioner did not consider factors such as those in Hoser v Hartcher that provide guidance to a court in deciding whether or not to dismiss proceedings for want of prosecution with due despatch. The Senior Commissioner limited her consideration to the obligation "to ensure that the dispute is resolved justly, quickly and cheaply" in s 56 of the Civil Procedure Act. That consideration was in error for the reasons already given. Whilst the purpose of promoting the just, quick and cheap resolution of proceedings is important, including in maintaining the integrity of the judicial system, it "cannot over-reach the rights of the individual litigants to justice in their own case": Fairey v Fairey (No 2) at [52]. The purpose of ensuring fairness to litigants, both the plaintiff and the defendant, is equally important as the purpose of maintaining the integrity of the judicial system.
In these ways, the Senior Commissioner erred on questions of law in exercising the discretion under r 12.7 to dismiss Pastoral's appeal for want of prosecution with due despatch.

Denial of procedural fairness

Rule 12.7 does not in terms state that a court may on its own motion, rather than on the application of the defendant, dismiss proceedings for failure of a plaintiff to prosecute proceedings with due despatch. Section 86(3) of the Civil Procedure Act allows the court to move of its own motion: "Subject to this Act and to rules of court, the court may make any order that it has power to make either of its own motion or on the application of a party or any other person entitled to make such an application."
This power of the Court to act on its own initiative is "subject always to according procedural fairness to each party": Gorczynski v Bendigo and Adelaide Bank Ltd [2016] NSWCA 170 at [6].
Pastoral submitted that the Senior Commissioner did not afford it procedural fairness before dismissing its appeal. Pastoral submitted that once the Senior Commissioner was considering exercising the power under r 12.7 to dismiss the proceedings for want of prosecution with due despatch, procedural fairness required her to give notice to Pastoral identifying the basis, evidence and reasons for considering dismissing the proceedings and affording an opportunity to be heard, including by Pastoral adducing evidence and making submissions on the appropriateness of the Court dismissing the proceedings of its own motion. The Senior Commissioner did not give Pastoral either proper notice or an opportunity to be heard.
Pastoral submitted that the Senior Commissioner's statements, during addresses on Pastoral's application for an adjournment of the hearing, that either she would dismiss the proceedings or Pastoral should discontinue the proceedings did not suffice to give proper notice to Pastoral or a proper opportunity for Pastoral to be heard. The Senior Commissioner did not identify the basis on which she was considering dismissing the proceedings. The Senior Commissioner nowhere referred expressly to r 12.7 or to the terms or substance of the rule. The Senior Commissioner did not identify what she considered to be the failure of Pastoral to prosecute its appeal with due despatch. The Senior Commissioner's invitation to Pastoral to address on the binary choice that she gave Pastoral of either a dismissal or discontinuance of the proceedings was inadequate both as to notice and an opportunity to be heard.
Pastoral submitted that procedural fairness required the Senior Commissioner to give Pastoral notice of the particular rule to be applied and the basis for application of that rule. Where it is alleged that a plaintiff has been so derelict in its conduct of the proceedings as to lead to the possible dismissal of the proceedings under r 12.7, the plaintiff needs to know that as a minimum, Pastoral was entitled to know which rule the Court was considering applying in order to dismiss the proceedings. Further, where the Court was considering exercising r 12.7 of its own motion, and not on application of the defendant, Pastoral submitted that it was entitled to know why it was alleged that it had conducted itself so as to bring about the application of r 12.7 and to address the matters of discretion as to whether the rule should be applied.
The Council did not dispute that the Senior Commissioner was under a duty to afford Pastoral a fair opportunity to be heard before she dismissed the proceedings for want of prosecution with due despatch. The Council submitted, however, that the Senior Commissioner discharged this duty. The Council submitted that the Senior Commissioner gave Pastoral adequate notice that she was considering dismissing the proceedings, allowed Pastoral a brief adjournment in order for it to consider whether it wished instead to discontinue the proceedings, and allowed Pastoral an opportunity to make submissions before the Senior Commissioner dismissed the proceedings.
The Council contested that the content of the duty to afford Pastoral an opportunity to be heard included giving notice of the particular source of power to be exercised to dismiss the proceedings. It was not necessary for the Senior Commissioner to identify r 12.7, either by rule number or by the terms or substance of the rule. It was not necessary for the Senior Commissioner to identify the basis, evidence or reasons for exercising the rule. It was sufficient for the Senior Commissioner merely to notify Pastoral that she was considering dismissing the proceedings.
I consider that the Senior Commissioner did deny Pastoral procedural fairness by failing to give it a fair opportunity to be heard before the proceedings were dismissed.
The power under r 12.7 to dismiss proceedings for failure of a plaintiff to prosecute proceedings with due despatch can be exercised by the Court on its own motion and not only on application by a party: s 86(3) of the Civil Procedure Act. The power of the Court to act on its own motion must, however, be exercised by according procedural fairness to each party. What is required in order to accord procedural fairness depends on the power to be exercised, the circumstances in which the power is to be exercised and the consequences for each party if the power is or is not exercised.
At a minimum, the Court needs to identify the power that is proposed to be exercised and the factual matters that not only enliven the exercise of the power but also make the exercise of the power just in the circumstances. The Court needs to give the plaintiff a fair opportunity to be heard on the Court's potential exercise of that power having regard to those matters in those circumstances.
The Senior Commissioner neither provided such notice nor such opportunity to be heard to Pastoral before exercising the power under r 12.7. The Senior Commissioner gave Pastoral an ultimatum: either Pastoral discontinued the proceedings or, if it did not, she would dismiss the proceedings. The opportunity the Senior Commissioner gave Pastoral to be heard was limited to considering this ultimatum. She allowed a brief adjournment in order for Pastoral to consider which of the two options it preferred. Pastoral advised, after the adjournment, that it did not wish to discontinue its appeal. The Senior Commissioner said that in that event she would dismiss the proceedings.
This course of action did not discharge the Senior Commissioner's duty to afford Pastoral procedural fairness. The Senior Commissioner did not identify the source of power that she was considering exercising to dismiss the proceedings. The Senior Commissioner never referred to r 12.7, either by rule number or by its terms or substance. The Senior Commissioner did not identify that she considered that Pastoral had failed to prosecute the proceedings with due despatch, or say any words to that effect.
The Senior Commissioner did, of course, address the fact that Pastoral's ecological expert had not undertaken an assessment of significance for the identified threatened species of fauna, for this was the basis for Pastoral seeking an adjournment of the hearing in order to have its ecological expert complete this assessment. The Senior Commissioner refused Pastoral's application for an adjournment of the hearing to allow for this assessment to be completed. But the Senior Commissioner did not go on to identify that the ensuing absence of the assessment caused Pastoral to have failed to have prosecuted the proceedings with due despatch, if this were to be the matter the Senior Commissioner considered enlivened the power under r 12.7 to dismiss the proceedings.
Identification of the rule that is the source of the power that the Senior Commissioner was considering exercising to dismiss Pastoral's proceedings, and the factual circumstances that the Senior Commissioner considered both enlivened and structured the exercise of the power, was necessary in order to give Pastoral a fair opportunity to be heard regarding the Senior Commissioner's potential exercise of the power. There are numerous sources of power for a court to dismiss proceedings and each has different circumstances to enliven and structure the power. Merely giving notice of the possibility of dismissal of the proceedings, without identification of the power and the circumstances for exercise of the power, was insufficient to alert Pastoral to the case it needed to address.
The Senior Commissioner thereby denied Pastoral procedural fairness in dismissing the proceedings under r 12.7.

Pastoral Investment Land & Loan Pty Ltd v Central Coast Council

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