Rossi v Living Choice Australia Ltd

Solicitors: DG Briggs & Associates (Appellant) Pikes & Verekers Lawyers (First Respondent) Maddocks Lawyers (Second Respondent) Department of Planning and Infrastructure (Third Respondent) File Number(s): 2013/366851 Decision under appeal Court or tribunal: Land and Environment Court of NSW Jurisdiction: Class 4 Citation: Rossi v Living Choice Australia Ltd (No 3) [2013] NSWLEC 46 Rossi v Living Choice Australia Ltd (No 4) [2013] NSWLEC 136 Rossi v Living Choice Australia Ltd (No 5) [2013] NSWLEC 197 Rossi v Living Choice Australia Ltd (No 6) [2014] NSWLEC 116 Date of Decision: 25 November 2013; 6 August 2014 Before: Pain J File Number(s): 2012/40018

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Judgment

1. THE COURT: On 21 August 2015, the Court handed down judgment allowing in part an appeal brought by Mr Rossi from decisions made in the Land and Environment Court and dismissing cross-appeals and applications for leave to cross-appeal brought by each of Living Choice Australia Ltd ("Living Choice") and The Hills Shire Council ("the Council"). [1]
2. Directions were made to facilitate the prompt resolution of the outstanding issues being, first, the ameliorative relief to be ordered in relation to unauthorised works that had been undertaken by Living Choice on the boundary of Mr Rossi's land and on its own land; and, second, the costs of the proceedings both in the Land and Environment Court and in this Court. The Court indicated that those issues would be determined on the papers.
3. Each party filed submissions with respect to costs; Mr Rossi and Living Choice filed separate submissions as to the form of orders to effect ameliorative relief.

Ameliorative orders

1. Mr Rossi and Living Choice have been unable to reach agreement as to the ameliorative orders to be made. In particular, while they have agreed as to the specification to be adopted for the necessary landscaping work, they have not agreed as to the landscape plan (or plans) to be adopted.
2. In the principal judgment, Emmett JA concluded that appropriate relief would order that work be carried out to obviate the adverse consequences for the Rossi land (loss of amenity, privacy and the like) from the unauthorised works undertaken by Living Choice, which included the removal of vegetation on the Rossi boundary without his consent. Landscaping work is required both on the Rossi land and on the land the subject of the Living Choice development. Such work will need to take into account the fact that the finished floor levels of the villa units at the western end of the Rossi boundary are significantly higher than the natural levels of the Rossi land, there having been a failure to take into consideration matters required by s 79C(1)(a)-(c) of the Environmental Planning and Assessment Act 1979 (NSW) ("the EP&A Act") when Living Choice's application for the relevant development consent was assessed and determined by the Joint Regional Planning Panel ("the JRPP").
3. Both Mr Rossi and Living Choice have produced landscaping plans prepared by consultants retained by each (Mr Ian Jackson on behalf of Mr Rossi, Ms Narelle Sonter on behalf of Living Choice). Both Mr Rossi and Living Choice criticise the plans produced by the other and both do so employing at times inflammatory language. As noted by Living Choice in its submission, "had the matter been remitted, a joint expert report would almost inevitably have been required." The submission continued: "This Court is now left in the unenviable position of adjudicating on competing landscape plans without the benefit of expert assistance…".
4. In his submissions on the proposed final orders, Mr Rossi listed thirteen objectives sought to be achieved by his proposed landscaping plans. It is not necessary to repeat them here. Living Choice did not argue that any of those objectives is not appropriate, although it said that it would be impossible to comply with that which referred to the immediate screening of the Living Choice development from the Rossi house and its curtilage, since screening will not be immediate under either party's proposed landscaping plans and some period of growth will be necessary. However, Living Choice pointed out that both plans provided for the planting of mature trees in large pot sizes.
5. Mr Rossi criticised the Living Choice plan as to the type of trees to be planted; failure to screen the elevated kitchen and living room windows and open elevated courtyards of the villas overlooking Mr Rossi's land; and failure of the lower order plantings to screen the development.
6. Living Choice criticised (in somewhat emotive terms) the Rossi plan as proposing the "unjustified" removal of all existing landscaping on the Living Choice land and the planting of "visually chaotic and excessive numbers of trees and shrubs" (referred to elsewhere as a "cacophony" of species). It argued that the Rossi plan would lead to competition by plants for light and nutrients, risk plant failure and lead to frequent and expensive silvicultural treatment. It would also impact on solar access, thus reducing the energy efficiency of the villas in winter, contrary to the design principles of the Seniors SEPP, [2] cl 35. Living Choice criticised the proposed use under the Rossi plan of a dense evergreen species of tree and submitted that the villa occupants should be consulted if loss of their amenity were to be threatened.
7. Having regard to the complaints made as to the impact of the Rossi plan on villa occupants and, in particular, the allegation that the plan would be contrary to the design principles of the Seniors SEPP, and the absence of a joint expert report, there is no choice (unattractive as it will inevitably lead to the incurring of yet further costs) but to remit the proceedings to the Land and Environment Court for the making of the appropriate ameliorative orders.

Costs - general positions

1. The remaining issue is as to the costs both of the Land and Environment Court proceedings and of the appeal. The parties' respective positions on costs are, again, divergent.
2. Mr Rossi submitted that he should have the whole of his costs both of the proceedings at first instance and the appeal, and interest on the former. He submitted that Living Choice and the Council should each be ordered to pay 50% of his total costs.
3. Living Choice accepted that the allocation tentatively proposed by Basten JA in this Court's principal judgment at [63] (that Mr Rossi receive 65% of his costs) was appropriate, though also described as "generous", but argued that Mr Rossi should only receive 50% of his costs of the appeal. Living Choice proposed a slightly different allocation as between it and the Council of the costs at first instance, namely 6.5% payable by it alone and the balance on a joint and several basis, without apportionment.
4. The Council sought an order that Mr Rossi pay 50% of its costs of the proceedings below, or otherwise the costs of discrete issues on which the Council claimed it had succeeded. With respect to the costs in this Court, somewhat confusingly, it sought orders that Mr Rossi pay 50% of its costs in this Court and that it pay Mr Rossi 10% of his costs of "the appeal".
5. Neither Living Choice nor the Council raised any objection to the payment of interest on Mr Rossi's costs.
6. The parties' submissions on costs demonstrate the wisdom of a broad brush global approach to minimise ongoing disputes in what has been a complex and highly contentious matter. It would seem likely that further expense would be incurred if costs were to be determined on an issue by issue basis.

Approach of Land and Environment Court

1. The primary judge approached the question of costs [3] by grouping the costs into various categories, namely (a) the judicial review challenge to the stage 2 consent and the validity of the two notifications of stage 2 consent (as to which Mr Rossi was awarded 50% for which all the defendants, including the JRPP, were to be liable); (b) the civil enforcement proceedings (as to which Mr Rossi's costs were to be paid by Living Choice alone); (c) the judicial review challenge to the retaining walls consent (as to which Mr Rossi's costs were to be borne by Living Choice and the Council); and (d) the exercise of discretion on the question of relief (as to which Mr Rossi's costs were again to be borne by Living Choice and the Council). In respect of certain identified matters her Honour held that each party should bear his or its own costs.
2. There was no error in approaching the question of costs on that basis although, as adverted to by Basten JA at [60] of the principal judgment and as had been submitted by Mr Rossi, that left open the unenviable prospect of further disputation as to the apportionment of the costs as between the various issues.
3. The primary judge did not deal with the question of interest on costs which had been sought by Mr Rossi, a failure challenged by him on this appeal. It seems likely that in the complexity of the matter this aspect of the relief sought by Mr Rossi was simply overlooked.

Costs in Land and Environment Court

1. In support of the proposition that he should have the whole of his costs in the Land and Environment Court, Mr Rossi relied, first, on the events leading up to the proceedings and the history of the proceedings, including (a) his complaints to the Council, which did not take action against Living Choice (as a result of which, he was forced to do so) so that Living Choice continued to develop the land even after proceedings challenging the development consent were commenced; (b) the Council having "undermined" his case by purporting to issue a new notice of determination and by failing to stop Living Choice and by granting consent to boundary works. He further submitted that during the hearing Living Choice continued to sell the right to occupy villas 204 to 210 to third parties and therefore he had to "soften the relief" that he claimed from demolition orders to orders for dense landscaping on the boundary. Mr Rossi also submitted that his costs were substantially increased as a result of the Council taking an active role in the proceedings so that he was opposed by two respondents, separately represented; and by the Council granting development consent for the retaining wall during the proceedings knowing that the work was completed. He argued that the Council should have entered a submitting appearance.
2. Mr Rossi submitted that the Council and Living Choice should each be ordered to pay 50% of his costs of the proceedings (rather than being jointly and severally liable to pay the whole) because it was fair and reasonable that they share his costs "just as they jointly tried to defeat him."
3. As to the claim for interest on those costs, Mr Rossi pointed out that the exercise of discretion under s 101(4) of the Civil Procedure Act 2005 (NSW) focused upon whether he, as the successful party, had been out of his money for costs already paid and whether he would be appropriately compensated by an award of costs in his favour, without an award of interest on costs already paid. An order to that effect, not being opposed, should be made in the usual form.
4. Living Choice accepted the order tentatively proposed by Basten JA that Mr Rossi should recover 65% of his costs. However, it submitted that liability for this amount should be allocated as against Living Choice for 6.5% (being Mr Rossi's costs of the civil enforcement proceedings that the primary judge had may have accepted to be 10% of the trial time [4] ) and as against both the Council and Living Choice jointly and severally for the balance (except to the extent that the JRPP was also held liable for costs).
5. As between Mr Rossi and Living Choice, making due allowance for the improved level of success achieved by Mr Rossi as a result of the hearing in this Court, it remains the case that he did not have total or even substantially full success at the trial. So much is demonstrated by the careful reasons given by the trial judge in Rossi v (No 6). The tentative view expressed by Basten JA was, however, marginally on the low side: an appropriate order is that Mr Rossi receive 70% of his costs of the trial proceedings as a whole.
6. Why Mr Rossi proposed that he should have separate orders against the Council and against Living Choice is by no means clear unless, by rendering each party responsible for only 50% of his costs, the result might appear more palatable. Putting to one side the arguments presented by the Council, that course should not be accepted.
7. Living Choice proposed a minor division of the joint and several liability, by which it would have accepted responsibility in full for a small part of Mr Rossi's costs. That course, even though only a minor degree of differentiation by issue, should also not be accepted. The underlying reasoning may be taken into account, but in the formulation of a proportion to be applied across the board. Before addressing that issue, it is necessary to have regard to the Council's submissions.
8. The position adopted by the Council was not entirely coherent. The Council's position differed markedly from that of the other parties. It submitted that, so far as the issues concerned the Council, Mr Rossi should pay 50% of its costs. It sought to distinguish its role from that of the JRPP and to rely upon the fact that, beyond its role in notifying development applications and the stage 2 consent, it should not have been a party to the proceedings. That was to accept a view expressed in the principal judgment which was, however, inconsistent with earlier authority in the Land and Environment Court which the Council itself did not challenge. Nor did the Council adopt the neutral position approved in The Queen v Australian Broadcasting Tribunal; Ex parte Hardiman. [5] Had it done so, it might have limited its liability as to costs; not having done so, it will bear the appropriate responsibility for costs as an unsuccessful party, to the extent that it was unsuccessful.
9. The Council submitted that Mr Rossi was almost wholly unsuccessful in relation to his claims against the Council, as opposed to his success against the JRPP, with the exception of the issues relating to the October 2010 notification of the development consent and the validity of the retaining wall consent. It submitted that neither of those two issues occupied much time, referring to the estimate by its solicitor that those issues occupied 2% and 5% of the total time and cost respectively, which it says was unchallenged and accepted by the primary judge. [6]
10. There is force in Mr Rossi's submission that his complaints as to the unauthorised works were vindicated. The assessment of the development consent did not comply with the statutory requirements insofar as it failed to take into account the impact of the heightened finished floor levels (as explained in detail in the principal judgment in this Court). The Council, though not the decision-maker, was responsible for the material on which the JRPP ultimately made its assessment and determination. Living Choice meanwhile proceeded to carry out the unauthorised works at a time when it knew there was an issue as to the validity of the development consent and its actions made it practically impossible for Mr Rossi to achieve the result he sought to achieve initially - namely the demolition of the unauthorised works.
11. The Council sought to argue that it might not have been actively involved in the proceedings, had Mr Rossi not sought to review its conduct. However, it was not obliged to defend its conduct in circumstances where there was an active party, Living Choice, with an interest and commitment to that defence. The principal element of the Council's alleged success flowed from the conclusion that the JRPP was the responsible decision-maker. That was not the primary position adopted by the Council. Nevertheless, to the extent that the decision-making process was found wanting, the Council and the JRPP should share responsibility for Mr Rossi's costs in that respect.
12. As between Living Choice and the Council, there are two factors affecting the apportionment of costs. The first, as noted by Living Choice, was that it should bear liability for the civil enforcement proceedings, which the trial judge estimated at 10% of trial time. To similar effect, the Council should not be responsible for the costs of seeking ameliorative orders as appropriate relief for the breaches of planning law accepted by the Court. The Council played no part in that dispute, either at trial or on appeal. On the other hand, it was an absence of complete success with respect to the latter issues which was one factor taken into account in disallowing part of Mr Rossi's costs.
13. Contrary to Mr Rossi's position, it is not appropriate to award costs against the separate respondents individually. Consistently with the approach adopted above, it is not in the interests of the efficient disposal of this case to apportion costs according to issues. Rather, Mr Rossi should recover a defined proportion of his costs, for which each of the respondents will be jointly and severally liable. Because there is no agreement between the respondents as to their respective liabilities, the Court should indicate the proportions as between them which it considers appropriate, as in a determination of cross-claims between defendants. The appropriate course is to apportion the liability of Living Choice at 65% of Mr Rossi's recoverable costs and the Council's liability at 35%. The Council's share should include that of the JRPP, so that any contribution made by the JRPP to Mr Rossi's costs will count, as between the Council and Living Choice, as a payment of Council's share. The result, in round terms, is that as between themselves, Living Choice will be liable for 45.5% of Mr Rossi's costs of the proceedings in the Land and Environment Court and the Council (and the JRPP) will be responsible for 24.5%. (Mr Rossi will carry 30% of his own costs of the trial.)
14. Mr Rossi should have interest on the allowed percentage of his recoverable costs and disbursements, as assessed or agreed, which he has paid to his legal advisers in connection with the proceedings in the Land and Environment Court. (Any dispute as to the amounts actually paid and the dates of payment, if not determined by agreement or on a costs assessment, shall be resolved in the Land and Environment Court.)

Costs of the appeal

1. Mr Rossi submitted that he should have the whole of his costs of the appeal, the "event" being the invalidation of the stage 2 consent (subject to relief under the Land and Environment Court Act 1979 (NSW), s 25B), the invalidation of the notification of consent and the invalidation of the retaining walls consent. He argued that the costs of the appeal were substantially inflated by the Council's active role in the appeal, noting that even in this Court the Council sought leave to cross appeal on the inference to be drawn from the absence of evidence from a Council officer.
2. Living Choice submitted that it and the Council should be liable for 50% of Mr Rossi's costs, to reflect his limited success on appeal. It supported that conclusion by an analysis of those parts of the judgment at first instance that were affected by the outcome of the appeal. In essence, it submitted, Mr Rossi achieved only a modest change to the outcome of the proceedings at first instance (and did so at great additional cost to all parties). To the extent that Mr Rossi achieved a result on appeal that was to the practical detriment of Living Choice, that was a detriment that Living Choice both sought and accepted at trial.
3. Living Choice also noted that there was no express determination of its notice of contention and cross appeal ground 1, the Court having rejected Mr Rossi's argument that it was necessary for retaining walls to have been included in the stage 2 development application and that the stage 2 consent did not extend to fill and retaining walls. [7] It was submitted that this issue should not sound against Living Choice by being included in Mr Rossi's appeal costs for which Living Choice may be liable.
4. Living Choice pointed to various findings of the primary judge which it characterised as being unaffected by the determination of the appeal, distinguishing between those on which Mr Rossi failed (being the notification of stage 2 development consent and the validity of the second notice of determination of the stage 2 development consent), and those on which Mr Rossi had succeeded at first instance (failure in the JRPP's determination of the stage 2 development application; the civil enforcement proceedings against Living Choice in respect of breaches of s 76A of the EP&A Act on both the Living Choice land and the Rossi land and the challenge to the retaining walls consent). Living Choice noted that Mr Rossi failed to maintain his success on the trial judge's finding of failure in assessment of the stage 2 development application by the Council (being the Council's cross appeal ground 1).
5. Thus, Living Choice submitted, the only success of Mr Rossi on appeal compared with the outcome at first instance was in obtaining a declaration that the first purported notice of determination of the stage 2 development consent dated 12 October 2010 was invalid and some limited success in obtaining directions to vary the discretionary ameliorative orders made by the primary judge. It said that Mr Rossi's partial success in persuading this Court to make directions to vary the primary judge's ameliorative orders must be discounted by the fact that in 2013 Living Choice had already offered at trial that which the parties were directed by this Court to seek to achieve.
6. Living Choice submitted that Mr Rossi should have an order for 50% of his costs on appeal, as to which each of Living Choice and the Council should bear half.
7. Mr Rossi disputed the proposition that in relation to ground 1 he was not successful. He submitted that an order under s 25B of the Land and Environment Court Act operates only when invalidity is proven and that the event he was seeking to correct was administrative error in the planning processes that resulted in a severe loss of privacy and amenity of his land. He had proved the statutory breaches and obtained discretionary remedies.
8. The Council submitted that on the issues in the appeal (as itemised by Emmett JA) it was successful on 1, 2, 8 and 9, whereas Mr Rossi was successful on 4, 5, 7 and 10 (in part). It submitted that, as against the Council itself, issues 4 and 5 should be considered as part of issue 1, given that Mr Rossi's case against the Council relating to the stage 2 consent failed. Mr Rossi's success on the appeal on the question of appropriate relief was not a matter that concerned the case against the Council, as the relief flowed either from the JRPP's error or from the breach by Living Choice of s 76A of the EP&A Act. (Mr Rossi took issue with this submission.)
9. The Council further submitted that Mr Rossi should bear 50% of the Council's costs of the appeal and that the Council should only bear 10% of Mr Rossi's costs. Alternatively, if the Court were minded to make any costs order in favour of Mr Rossi in relation to the costs of the appeal, the Council submitted that those costs should be apportioned as between the Council and Living Choice, with Living Choice bearing the "vast majority" of those costs, and that liability not be joint and several.
10. As with the costs of the trial, there should be a global assessment. The Council's allocation of success and failure cannot be accepted. Living Choice made a more realistic assessment of the extent of Mr Rossi's degree of success, but by reference to the practical outcome, rather than the issues for determination. The fact that Living Choice might have accepted something akin to the practical result at an early stage is beside the point; it fought Mr Rossi strenuously in this Court (and at trial). On the other hand, Mr Rossi's assessment of substantially total success was unrealistic. It is true that demonstrating a sound basis for holding a planning consent to be invalid is an important outcome, but the availability of relief under s 25B limits the consequences. The appropriate assessment is to order that the Council and Living Choice be jointly and severally liable for 75% of Mr Rossi's costs on appeal.
11. The failure to achieve a final resolution as to the ameliorative relief requires that the post-hearing costs should be treated as costs on the remitter. Further, Mr Rossi has not achieved what he sought as to costs orders. Thus Mr Rossi's costs of the appeal should not include any costs incurred post-hearing.
12. The respondents should be jointly and severally liable to Mr Rossi for the relevant proportion of his costs of the appeal, but should bear responsibility equally as between themselves.

Declaration pursuant to s 25B

1. Living Choice, in its reply to Ms Rossi's submission concerning the final orders, noted that the orders proposed by this Court in the principal judgment did not include any order under s 25B of the Land and Environment Court Act. Nevertheless, Emmett JA had noted the appropriateness of such an order. [8] Mr Rossi's proposed orders 2 and 6 made provision for such an order.
2. Living Choice argued that it is unnecessary, in light of the discretionary power under s 124(1) of the EP&A Act to remedy or restrain a breach of the EP&A Act, for such an order to be made. It submitted that an unintended consequence of an order under s 25B is that a suspension of a development consent can only be removed by an application by the Council to the Land and Environment Court under s 25C(1), and that the holder of the consent has no standing to seek an order lifting the suspension and may not be able to compel the Council to do so if it refuses to act. Living Choice submitted that suspension of the consent in part would add nothing to the work which it accepts it must do to landscape around the boundary. It submitted that Mr Rossi's proposed orders 2 and 6 were inapposite, given the limitations on seeking the removal of a suspension under s 25C, and a concern that the consent authority, being the JRPP, has no powers beyond the determination of the development application, referring to cl 21(1) of the Seniors SEPP.
3. Accepting the apparent limitations on the parties which may make an application under s 25C for a declaration that the terms of an order have been substantially complied with, it is by no means clear that the developer subject to such an order cannot seek declaratory relief, or a variation of the original order. It is appropriate to make an order under s 25B, but not precisely in terms of the order sought by Mr Rossi. Given the outstanding issue as to the nature of the ameliorative work, which is to be remitted to the Land and Environment Court, that Court should have liberty in its discretion to vary the order made by this Court.

Orders

1. The final orders proposed by Mr Rossi included orders already made. It is not necessary to restate those orders. Rather, in addition to the orders made on 21 August 2015, the Court now orders: (1) Mr Rossi's appeal is allowed in part. (2) Pursuant to s 25B of the Land and Environment Court Act 1979, suspend development consent number 280/2010/JP issued by the third respondent insofar as it relates to the construction of villa units 206-210 until such time as any orders made by the Land and Environment Court on the remittal of the matter provided for in order (4) of these orders have been substantially complied with by the first respondent, or such other time as may be fixed by the Land and Environment Court. (3) Set aside orders 2.1-2.3 and 3 made by the primary judge on 25 November 2013. (4) Remit the matter to the Land and Environment Court to determine the ameliorative relief to be ordered in accordance with this Court's reasons. (5) Further to order (5) made on 21 August 2015, (a) order that the first and second respondents pay 70% of Mr Rossi's costs of the proceedings in the Land and Environment Court to date, such liability to be joint and several; (b) apportion those costs as between the respondents as to 65% against the first respondent (Living Choice Australia) and 35% against the second respondent (the Council), but with payments by the third respondent (the Panel) to be in part satisfaction of the second respondent's portion. (6) (a) Order that the first and second respondents pay 75% of Mr Rossi's costs of the proceedings in this Court (disregarding costs incurred after the hearing in this Court) such liability to be joint and several; (b) as between the respondents, apportion liability for those costs equally. (7) Order that the first and second respondents pay interest at the rate provided for in the UCPR on the Allowed Percentage of each amount of costs and disbursements which Mr Rossi has actually paid to his legal advisers in connection with the proceedings in the Land and Environment Court from the date of payment of each such amount. (8) In order (7), the Allowed Percentage is to be determined according to the following formula: X = the total amount of costs and disbursements which the appellant has paid or is liable to pay his legal advisors in connection with the Land and Environment Court proceedings Y = the recoverable costs and disbursements allowed on assessment or by agreement to the appellant in connection with the Land and Environment Court proceedings The Allowed Percentage = Y/X x 100. (9) Direct that the post-hearing costs in this Court relating to the appropriate ameliorative relief be treated as costs of the remitted proceedings in the Land and Environment Court.

Endnotes

1. Rossi v Living Choice Australia Ltd [2015] NSWCA 244 ("the principal judgment").
2. State Environmental Planning Policy (Planning for Seniors or People with a Disability) 2004.
3. Rossi v Living Choice Australia (No 6) [2014] NSWLEC 116 ("Rossi (No 6)").
4. Rossi (No 6) at [29], although it is unclear whether this evidence was accepted.
5. (1980) 144 CLR 13 at 35-36.
6. Rossi (No 6) at [64]-[74].
7. Principal judgment at [335] (Emmett JA).
8. Principal judgment at [365] and [385]. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 September 2015