Prosecutor v SYDNEY WATER CORP LTD

93. The Court recognises that an order for costs is not made to punish an unsuccessful party, but the most important factor which influences the exercise of the costs discretion is the outcome of the litigation.

94. There is no room in the present case for an allegation of the type of misconduct identified by McHugh J in Oshlack v Richmond River Council (1997) 96 LGERA 173 at 193:-

"Misconduct" in this context means misconduct relating to the litigation, or the circumstances leading up to the litigation. Thus, the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation; unnecessarily protracts the proceedings; succeeds on a point not argued before a lower court; prosecutes the matter solely for the purpose of increasing the costs recoverable; or obtains relief which the unsuccessful party had already offered in settlement of the dispute.

Apart from anomalous examples in the equity jurisdiction, there are very few, if any, exceptions to the usual order as to costs outside the area of disentitling conduct.

95. It is apparent therefore that exceptional circumstances must exist in order to deprive a successful party of the entitlement to its costs.

96. The observations by Toohey JA at p 565-6 in Latoudis v Casey (1990) 170 CLR 534 again points to the principle that a refusal of costs to a successful party will ordinarily be based upon the conduct of that party in relation to the proceedings.

97. Section 52 of the Land and Environment Court Act provides the Court with the undoubted discretion to order the defendant under the present circumstances to pay to the prosecutor costs determined in accordance with s 52(2).

98. Costs are compensatory and they are awarded to indemnify the successful party against the expense of conducting the proceedings.

99. The making of an order for costs is not to be regarded as if it amounted to the imposition of a penalty or punishment unless the order for costs recognises a default on the part of the successful party.

100. The Court is not satisfied that there should be any special order as to costs having regard to the whole of the circumstances under which these proceedings were conducted.

101. It follows therefore that the defendant will be ordered to pay the costs of the prosecutor.

1. The defendant is convicted of the offence as charged in the summons.

2. The defendant is ordered to pay a fine in the sum of $100,000.

3. The defendant is ordered to pay the costs of the prosecutor in such amount as may be agreed or if no such agreement can be reached in accordance with the regulations under the Land and Environment Court Act 1979.

I hereby certify that this and the preceding 20 pages are a true and accurate record of the reasons for judgment herein of the Honourable Justice R N Talbot.

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