Syncept Chatham Pty Ltd v City of Ryde Council

Land and Environment Court (NSW)|2020-04-17|Before: Duggan J

Background facts

These proceedings relate to the Applicant's challenge to the validity of an Interim Heritage Order (IHO) made in connection with its land. I determined those proceedings in the principal judgment Syncept Chatham Pty Ltd v City of Ryde Council [2019] NSWLEC 170. The facts and findings I made in connection with the substantive proceedings are relied upon but are not repeated here. The matter is now before me to determine the issue of costs of the proceedings.
On 8 November 2019 I made the following declaration: … any Interim Heritage Order made by the Respondent pursuant to the resolution of the Council on 27 February 2019 pursuant to s 25 of the Heritage Act 1977 in respect of the land known as Lots 13 and 14 DP 9166 located at 68-70 Chatham Road, Denistone was made in breach of paragraph 1(b) of the Ministerial Authority made on 12 April 2013 and is invalid.
At that time I was inclined to make the usual order as to costs (as modified to reflect the raising of Ground 2 on the first day of the hearing), as neither party had addressed me to suggest otherwise. I indicated that intention in the proposed order in the following terms: Respondent is to pay the Applicant's costs of the proceedings excluding costs for the hearing on 4 October 2019 … [Note: Order 2 suspended for 14 days from 8 November 2019 for further submissions by the parties on the issue of costs].
In accordance with the invitation reserved to the parties in the proposed order the Council sought to make submissions on the issue of costs, and accordingly, the proposed order was not entered. The Council contends that the usual order (either at all or in the proposed form) should not be made and that due to the circumstances of this case an order should be made that each party pays its own costs. The Applicant contends that the proposed order as originally formulated is the appropriate order in these proceedings.

Council's submissions

The Council contends that it is inappropriate in the circumstances of this case that the usual order as to costs be made. The Council submits that each party should pay its own costs due to the following circumstances: 1. The amendment to the Applicant's Summons raising Ground 2 was made late, after the trial had commenced. The Council submits that this late amendment is sufficient on its own to justify that there be no order as to costs, as: 1. There were two prior interlocutory hearings dealing with the invalidity claim, however, the ultimately successful Ground was not raised on either instance; and 2. A timely application to seek to impugn the Council's resolution on 27 February 2019 relying on the Mayoral Minute would have rendered both interlocutory proceedings, as well as the Class 1 proceedings, unnecessary; 1. Ground 1 has not been the subject of any determination by the Court. It had no utility once the 8 November 2019 declaration was made as the declaration invalidated any IHO. That is, as both IHOs were found to be invalid, there was no second IHO to declare invalid, negating the effect of possible success on Ground 1. Had Ground 1 been made out, the Council could not have made another IHO for the subject properties. The Council thus understood it was meeting a case that had permanent effect on its power to make another IHO. Had the issue in Ground 2 been raised earlier, the Council could have raised different considerations; 2. Considering these factors, the proper order is that each party is to bear its own costs. As such, the principles in Beoco Limited v Alfa Laval Co Limited [1995] QB 137, as applied in Barry Edward and Thelma June Harrington v Greenwood Grove Estate Pty Ltd (No 2) [2011] NSWSC 1598 by Slattery J at [4], that as a general rule, where a plaintiff makes a late amendment which substantially alters the case the Defendant has to meet and without which the action will fail, the Defendant is entitled to costs of the action to the date of the amendment; and 3. An order that each party is to bear its own costs balances the costs position between the parties fairly, particularly having regard to the history of litigation and the limited result that was achieved.

Applicant's submissions

The Applicant contends that: 1. Given the Applicant succeeded in the matter the usual costs should be made, as per Rule 42.1 of the Uniform Civil Procedure Rules 2005 (UCPR) and that costs should follow the event. The order proposed by the Court is appropriate in all of the circumstances of this case; 2. The characterisation of how Ground 2 was raised in the proceedings is incomplete and inaccurate. The matter was raised as a consequence of the Council's formulation of its case and was not solely a matter raised by the Applicant; and 3. It was not necessary for the Court to determine Ground 1. It would be inappropriate in the costs hearing for the Applicant to be deprived of the usual order in light of the fact that success on Ground 2 rendered Ground 1 unnecessary. The fact that it was not necessary that the Ground be determined should not be treated as if the Applicant had failed on this Ground.

Findings on costs

Rule 42.1 of the UCPR applies to proceedings of this kind and provides that: 42.1 General rule that costs follow the event Subject to this Part, if the court makes any order as to costs, the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs.
That Rule operates as a presumption in favour of the usual order unless the Court, in the exercise of its discretion, determines that another order is appropriate. The circumstances that have been raised by the Council as matters that would warrant the making of another order are: that the Ground on which the Applicant was successful was introduced late in the proceedings; and, that Ground 1 was rendered unnecessary by that success and therefore should not be the subject of the costs order. For the reasons that follow, I do not consider that either of these factors warrants the making of an order other than the order that was initially proposed in these proceedings.
The raising of Ground 2 arose from the manner in which the Council formulated its defence to the proceedings generally. As I observed in [5] and [6] of my judgment in the substantive matter, the necessity for an adjournment and the raising of the issue was, in part, also due to the Council's desire to adduce further evidence. This desire to adduce further evidence was indicated on the day that the matter had been fixed for hearing. The raising of Ground 2 was specifically to address the reliance by the Council on the Mayoral Minute that it adduced in evidence by way of a bundle of documents on that day. I consider that the timing of the making of the application for leave to amend was understandable due to the manner in which the Council developed its defence and the evidence it sought to rely upon.
Further, the Council elected to defend the proceedings on Ground 2. That matter required the consideration of evidence and the making of submissions. The majority of the evidence in the matter and the substantive proceedings related to the determination of Ground 2. The issues relating to Ground 1 primarily related to documentary evidence.
It was unnecessary to determine Ground 1, as it was a consequence of my finding that the making of any IHO was beyond power. Therefore, the IHO was invalid whether it related to the first or second occasion in which the Council sought to exercise its power. That invalidity determined the outcome of Ground 1 - as absent power to make the IHO, the error asserted with respect to Ground 1 was rendered irrelevant when the substantive instrument was invalidly made. I do not consider that such finding operates in a manner to suggest that the Applicant not be entitled to the usual order.
The fact that the consequence of the finding of invalidity was that the Council retained the power to make another IHO within power (if it so elected) does not operate to disentitle the Applicant of an order for costs. The felicitous circumstance that the Council's invalid exercise of its power enabled it to exercise the power again does not alter the characterisation of the Applicant being successful in the proceedings.
To the extent that Ground 2 was raised late and that the need for an adjournment as a consequence of that late raising was, in part, due to the conduct of both parties, the costs order proposed excludes the costs of the first day of the hearing, for which each party is to bear its own costs. This variation of the usual order provides sufficient recognition that the late raising of the issue was caused by "fault" on both sides and is appropriate to overcome any inequity in the costs order from the late raising of the issue and the filing of evidence.
I do not consider that the decisions such as that in Barry Edward and Thelma June Harrington v Greenwood Grove Estate Pty Ltd (No 2) [2011] NSWSC 1598 are applicable in the circumstances of this case. As I noted in the substantive proceedings the raising of Ground 2 was derived in large part by the exposition of the Council's intended reliance on the Mayoral Minute to justify the exercise of power. That reliance was not fully identified until the first day of the hearing and the actions in raising Ground 2 were responsive to the position the Council took in opening its case. These circumstances are sufficiently distinguishable from those where a party amends its pleadings for no reason other than to change or alter its own case absent any influence from the actions of the other party. Further, absent a determination on Ground 1, the proposition of this authority that, absent the amendment, the claim would have failed, cannot be made good.
Accordingly, for those reasons I determine that it is appropriate that I make an order generally in accordance with the usual order provided for in Rule 42.1 of the UCPR, with the exception of the costs of the first day of the hearing on 4 October 2019 which will be excluded from the order.

Orders

The Court orders that the Respondent is to pay the Applicant's costs of the proceedings excluding costs for the hearing on 4 October 2019.

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: 17 April 2020

At a glance

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Judgment (6 paragraphs)

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Cases Cited (2)