On 9 March 2018, I upheld a judicial review challenge brought by the applicant, Ms Platford, and declared invalid a development consent granted by the second respondent, Shoalhaven City Council (the 'Council'), to the first respondent, Mr van Veenendaal: see Platford v van Veenendaal and Shoalhaven City Council [2018] NSWLEC 27. At the request of the parties I reserved the question of the costs of the proceedings.
The parties have subsequently made written submissions on the costs order that each submits should be made. The parties consent to my determining the question of costs on the basis of their written submissions.
Ms Platford seeks an order that the respondents pay her costs of the proceedings. Ms Platford notes that the general rule for judicial review proceedings is that costs follow the event (see Pt 42 r 42.1 of the Uniform Civil Procedure Rules 2005). Ms Platford was successful in the event: she established and obtained a declaration that the Council's exercise of power to grant development consent to Mr van Veenendaal was invalid.
Where an order for costs is made against unsuccessful respondent each of the respondents is jointly and severally liable for the costs. In practice, however, the effect in this case would be that the Council, as one respondent, and Mr van Veenendaal, as the other respondent, would be liable to pay half each of Ms Platford's costs of the proceedings.
The Council accepts that the general rule that costs follow the event should be applied and Ms Platford should be awarded her costs. The Council submits that both of the respondents should be liable to pay Ms Platford's costs.
Mr van Veenendaal also accepts that Ms Platford should be awarded her costs but submits that only the Council, and not Mr van Veenendaal as well, should be liable to pay her costs. This is the issue dividing the parties: should only the Council pay Ms Platford's costs or should both respondents pay her costs?
Mr van Veenendaal submits that he should not be liable for costs for three reasons. First, he is an innocent victim of the Council's error in determining the development application which led to the declaration of invalidity of the development consent. The declaration of invalidity of the consent did not arise from any error caused or contributed to by Mr van Veenendaal.
Secondly, Mr van Veenendaal entered a submitting appearance at an early stage in the proceedings. The submitting appearance was filed on 21 September 2017, one month after the commencement of the proceedings and prior to the first return date of the summons.
Mr van Veenendaal relied on authorities holding that ordinarily an order for costs will not be made against a submitting party: Develtor Property Group Pty Ltd v Newcastle City Council [2001] NSWLEC 47 at [42]; Highland v Labraga (No 3) [2006] NSWSC 871 at [20]-[23]; Midson v Workers Compensation Commission (No 2) [2017] NSWSC 147 at [28]-[31].
Thirdly, Mr van Veenendaal relied particularly on the "general guidelines" articulated by Biscoe J in Cutcliffe v Lithgow City Council (2006) 147 LGERA 330; [2006] NSWLEC 463 at [50] for the exercise of the costs discretion in judicial review proceedings. Biscoe J suggested that:
"The following general guidelines may be formulated, based on the cases and
principles reviewed in this judgment, for the exercise of the Court's discretion
to order costs where
• an applicant successfully brings proceedings that are necessary to have declared invalid or set aside a development consent or decision of a consent authority;
• the consent authority and the beneficiary of the development consent or decision are necessary or proper parties; and
• the cause of the invalidity is an error of or attributable to the consent authority and not to the beneficiary:
(a) the applicant will ordinarily be entitled to be compensated by an award in its favour of the costs of the proceedings unless it has engaged in disentitling conduct.
(b) where the beneficiary does not defend the proceedings, the applicant's costs will ordinarily be awarded against the consent authority, whether or not the latter enters a submitting appearance. This is because the cause of the litigation is the error of the consent authority and not of the applicant or the beneficiary. The consent authority cannot immunise itself from costs consequences of its own error by entering a submitting appearance because then a successful applicant cannot be properly compensated in costs. It is not sufficient that a consent authority should bear the applicant's costs only up to the time of the consent authority's submitting appearance because the applicant must continue to incur costs thereafter in order to establish, by evidence and argument at a hearing, that it is entitled to declaratory and injunctive relief.
…"
Mr van Veenendaal submits that the circumstances in para (b) apply here. In particular, the cause of the invalidity is the failure of the Council to consider relevant matters under three statutory instruments (see [66] and [67] of the judgment). Mr van Veenendaal submits that that failure was not caused or contributed to by Mr van Veenendaal.
Mr van Veenendaal submits that the "general guidelines" articulated by Biscoe J were applied by me in Brown v Randwick City Council (No 2) [2012] NSWLEC 28 at [25] where I said:
"Ordinarily, where both the consent authority that grants a development consent or makes a decision and a beneficiary of the development consent or decision are joined as necessary or proper parties to a successful judicial review challenge to the development consent or decision, the successful applicant's costs will be awarded against both the consent authority and the beneficiary. As Biscoe J stated in Cutcliffe v Lithgow City Council [2006] NSWLEC 463; (2006) 147 LGERA 330 at [50], the award of costs against the consent authority is because its error is the cause of the litigation. The consent authority cannot immunise itself from costs by entering a submitting appearance because then a successful applicant cannot be properly compensated in costs. The award of costs against the beneficiary who chooses to defend proceedings and take an active part in them is because of that choice. If a beneficiary wishes to avoid costs, it must choose not to defend the proceedings."
The Council contests that Mr van Veenendaal should be relieved of liability for Ms Platford's costs, just because he filed a submitting appearance. The Council too filed a submitting appearance on 22 September 2017, only one day after Mr van Veenendaal filed his submitting appearance. The Council, just like Mr van Veenendaal, took no active part in the proceedings after filing its submitting appearance.
The Council submits that the ordinary rule referred to in the authorities cited by Mr van Veenendaal, that no order for costs be made against a submitting party, applies in the same way to the Council as it applies to Mr van Veenendaal. This, however, would have the consequence that Ms Platford would not be compensated for her costs of her successful judicial review proceedings. This demonstrates that the ordinary rule about costs not being ordered against submitting parties has less application where all unsuccessful respondents have entered submitting appearances.
The Council submits that the general guideline of Biscoe J in para (b) of Cutcliffe, relied on by Mr van Veenendaal, should not be followed for a number of reasons:
1. It is only a guideline, not a principle of law.
2. It is obiter dicta: Cutcliffe v Lithgow City Council was not a case where both the consent authority and beneficiary of the consent entered submitting appearances.
3. Biscoe J did not cite any authority to support the guideline in para (b) where both respondents have filed a submitting appearance.
4. The policy reason given by Biscoe J for the guideline, of ensuring that a successful applicant is adequately compensated, is equally achieved by ordering both respondents who have entered submitting appearances to pay the applicant's costs.
5. The guideline in para (b) has been doubted by Basten JA in Rossi v Living Choice Australia Ltd [2015] NSWCA 244 at [73]:
"The circumstance engaging par (b) in Cutcliffe was that the beneficiary of the decision does not defend the proceedings; it was then said that the reason why the consent authority could not "immunise itself from costs consequences of its own error by entering a submitting appearance [was] because then a successful applicant cannot be properly compensated in costs." But that cannot be true in the case of proceedings which are actively defended by another party. The mere fact that the decision-maker is ultimately found to have erred in its approach is not, of itself, a sufficient reason to order costs against it, being costs incurred after the entry of a submitting appearance. So far as the guidelines in Cutcliffe suggest otherwise, they should not be applied."
The Council submits that the facts in Brown v Randwick (No 2) were also different to the present case. There, the Council had filed a submitting appearance but the beneficiary of the consent had not. The Court ordered all of the respondents to pay the applicant's costs. Here, both the respondents have filed submitting appearances. The Council submits that the comments in [25] of Brown v Randwick City Council (No 2) need to be read in that context. They do not lay down a principle that a beneficiary of the consent will not be ordered to pay costs if it chooses not to defend the proceedings.
The Council submits that an order for costs should also be made against Mr van Veenendaal for another reason: Mr van Veenendaal as the holder of the consent could have taken action that would have avoided the necessity for a hearing. The action that he could have taken included undertaking not to act on the consent or entering consent orders restraining him from acting on the consent or surrendering the consent under s 104A (now s 4.63) of the Environmental Planning and Assessment Act 1979 ('EPA Act'). The Council submits that it had no such power to resolve the proceedings without the necessity for a hearing.
Finally, the Council submits that to order the Council, but not Mr van Veenendaal, to pay Ms Platford's costs on the basis that the cause of the invalidity is the error of the Council (as Biscoe J's guideline suggests) would be to punish the Council, contrary to the cardinal purpose of a costs order (see Latoudis v Casey (1990) 170 CLR 534 at 543, 567; [1990] HCA 59; Ohn v Walton (1995) 36 NSWLR 77 at 79).
Mr van Veenendaal responded to the Council's submissions. Amongst the responses are:
1. The guidelines of Biscoe J in Cutcliffe, even if dicta, are "clearly on point" and should not be departed from, citing oOh! Media Assets Pty Ltd v Council of City of Sydney [2016] NSWLEC 47 at [151]-[155].
2. The observations of Basten JA in Rossi v Living Choice Australia Ltd at [71]-[73] are also obiter dicta; they are concerned with the circumstance where a decision-maker makes a submitting appearance but the other respondent has taken an active role.
3. Biscoe J's guidelines in Cutcliffe were based on the cases and principles reviewed in the judgment.
4. The Council could have taken steps to reduce the costs of the proceedings, by indicating to the applicant that it recognised that there were defects in the manner in which it handled the development application and assisting the Court in framing appropriate orders, citing Sidney Harrison Pty Ltd v City of Tea Tree Gully (No 2) [2001] SASC 34 at [18]. The Council took none of these steps.
5. Mr van Veenendaal could not practically have taken the action suggested by the Council. The injunction restraining acting on the consent only took effect on the consent being declared invalid. It is speculative whether the Council would have accepted any surrender of the consent in circumstances where the Court's decision had not been made and the Council never invited the surrender of the consent.
6. Making an order that the Council alone, and not also Mr van Veenendaal, pay Ms Platford's costs does not make the order for costs punitive rather than compensatory.
I find that the order to pay Ms Platford's costs should be make against both the Council and Mr van Veenendaal, and not the Council alone.
First, the ordinary rule that no order for costs should be made against a submitting party has less applicability in judicial review proceedings where both respondents, the consent authority which granted the development consent and the beneficiary of the development consent, make submitting appearances. Application of the ordinary rule would result in the successful applicant not being compensated for the costs of the proceedings.
Secondly, I do not consider it is appropriate in the circumstances of this case to apply the general guideline suggested in para (b) of Cutcliffe. That guideline is based on the assumption that "the cause of the invalidity is an error or attributable to the consent authority and not to the beneficiary." This assumption needs to be understood in the context in which the general guideline was suggested, being judicial review of the exercise of the power of a consent authority under the EPA Act (such as the determination of a development application by the grant of development consent). Necessarily, the judicial review proceedings will only be successful if the applicant establishes that there was invalidating error in the exercise of the power by the consent authority. Hence, the mere fact that the cause of the invalidity is an error of the consent authority is not, of itself, a sufficient reason to order costs against the consent authority. This is the point made by Basten JA in Rossi v Living Choice Australia Ltd at [73].
In any event, the guideline in para (b) is not applicable where the beneficiary of the consent can also be seen to have played a role in causing or contributing to the error that led to the invalidity of the consent. In this case, the beneficiary of the consent, Mr van Veenendaal, did play a role in causing or contributing to the Council's failure to consider the relevant matters, being the error that led to the invalidity of the consent.
The Council was bound to consider the relevant matters in Ch G6 of the Shoalhaven Development Control Plan 2014, cl 5.5(3)(d) of the Shoalhaven Local Environmental Plan 2014 and cl 8(j) of the State Environmental Planning Policy No 71 - Coastal Protection, which each required the Council to consider, in different ways, the risks associated with coastal inundation by wave runup on proposed development and the likely effect of the proposed development on wave runup flows. The proposed development of Mr van Veenendaal involved erection of a new dwelling and a boathouse arm erected in an area of the site exposed to coastal hazards. The boathouse arm comprised not only a boathouse room but also a solid concrete screen wall linking the boathouse to the main dwelling.
I found that the Council failed to consider the relevant matters under the three statutory instruments by failing to consider the likely effect of coastal inundation by wave runup on the screen wall in the wave runup area and the likely effect of the screen wall on wave runup flows. The Council only considered these likely effects in relation to the boathouse room, not the equally affected and affecting screen wall.
The Council's failure to consider the likely effects of wave runup on the screen wall and the likely effects of the screen wall on wave runup flows was a result of the information and reports before the Council also not addressing expressly these likely effects on and of the screen wall. The applicant for consent, Mr van Veenendaal, and the objecting neighbour, Ms Platford, had each submitted expert reports, which expressed conflicting opinions on the likely effects of beach erosion and coastal inundation on the proposed development and the likely effects of the proposed development on beach erosion and coastal inundation. The expert reports, however, did not address expressly the effects of wave runup on the screen wall component of the boathouse arm.
To resolve the conflict between the parties' experts, the Council engaged its own coastal hazards expert. The Council provided to its expert the parties' expert reports as well as certain of the plans submitted by Mr van Veenendaal with his development application. As I noted in the primary judgment (at [52]), those plans did not explicitly show the solid concrete screen wall connecting the boathouse room to the main dwelling. In these circumstances, the Council's expert may not have appreciated that the screen wall would be affected by and would affect wave runup. The result was that the Council's expert's report that was considered by the Council did not address the impact of wave runup on the screen wall and the impact of the screen wall on wave runup.
Whilst it is true that the duty to take into consideration the relevant matters in determining a development application is imposed on the consent authority, the applicant who seeks consent bears some responsibility to provide adequate information on the relevant matters in or accompanying the development application to enable the consent authority to take the relevant matters into consideration. An applicant who fails to provide adequate information on the relevant matters can hardly complain about any consequential failure of the consent authority to consider the relevant matters.
In this case, Mr van Veenendaal's failure to provide in or with his development application adequate information on the likely effects of coastal inundation by wave runup on the screen wall and the likely effects of the screen wall on wave runup flows was an initiating cause of the Council failing to consider these likely effects, which was the error that invalidated the consent. The inadequacy of the development application to provide sufficient information did not relieve the Council from its duty to consider the relevant matters in determining the development application. But it did mean that the beneficiary of the consent, Mr van Veenendaal, played a role in causing or contributing to the error that led to the invalidity of the consent.
Thirdly, and more generally, I consider that the guideline in para (b) of Cutcliffe proffers too rigid a rule that fails to take into account other circumstances connected to the case, including circumstances leading up to or in the conduct of the litigation, that may, in the individual case, make a different order for costs than that suggested in para (b) fair and reasonable. The guideline is not, and should not be applied as, a rule.
Fourthly, my comments in Brown v Randwick City Council (No 2) at [25] similarly did not establish any rule. My comments were directed to explaining why I had determined, in the circumstances of that case, that a costs order should be made against both the beneficiary of the consent, who had actively defended the judicial review proceedings, and the council as consent authority, notwithstanding that it had entered a submitting appearance. The comments had no wider application.
Finally, it is unnecessary in light of my findings that it is otherwise appropriate to order both respondents to pay the applicant's costs to determine either respondent's argument as to what action the other respondent could have taken to avoid the necessity of, or reduce the costs of, the hearing of the proceedings.
Having regard to all of the circumstances connected with the case, including the circumstance that both the consent authority which granted the consent and the beneficiary of the consent made submitting appearances, I consider it is fair and reasonable to order both the consent authority (the Council) and the beneficiary of the consent (Mr van Veenendaal) to pay the costs of the proceedings of the successful applicant (Ms Platford). The costs of the application for costs should be included in the costs of the proceedings.
The Court orders:
1. The respondents are to pay the applicant's costs of the proceedings.
2. The costs of the proceedings include the costs of the application for costs.
[2]
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Decision last updated: 05 June 2018