The Council of the City of Shoalhaven v. The Director General National Parks & Wildlife Service & Ors [2005] NSWCA 57

17 March 2005 The Council of the City of Shoalhaven v. The Director General National Parks & Wildlife Service & Ors Judgment 1 IPP JA: I agree with Bryson JA. 2 BRYSON JA: The Court allowed this appeal on 4 June 2004 for reasons then published and set aside an order [2003] NSW LEC 88 made by Cowdroy J on 18 July 2003 refusing to make a declaratory order which the appellant Council of the City of Shoalhaven (CCS) had claimed: the Court of Appeal ordered that a declaration be made establishing that CCS has an interest in fee simple in land shown depicted as roads in several deposited plans. The Court of Appeal reserved questions of costs in the Land and Environment Court (LEC) and costs of the appeal. The costs order in LEC was made by Cowdroy J on 4 December 2003 and it was in these terms: 2. In lieu of order 4 the following order be substituted:- An order that the first respondent and second respondent pay the applicant's costs of these proceedings other than: (i) the costs of the applicant of and incidental to the applicant's claim against the sixth respondent; and (ii) the costs of the applicant of and incidental to its claim in paragraph 2 and 3 of the further amended class 4 application dated 22 July 2002 that it has an interest in the roads in Deposited Plans 8515, 8516 and 8517. 3 In LEC CCS was the applicant and the Director General for National Parks & Wildlife Service and the Minister Administering the National Parks & Wildlife Act 1974 were the first and second respondents, as they are in the appeal. I refer to them as NPWS. 4 CCS asked that the Court of Appeal make an order for payment by the first and second respondents of CSS's costs of the appeal. 5 In support of its claim for costs in the Court of Appeal CCS submitted to these effects: · But for the position adopted by NPWS at the hearing in LEC the issue of the roads could have been resolved by consent orders. · By reason of NPWS formally contesting the issue and making submissions on the roads issue, this led ultimately to the erroneous findings and the need for this appeal. · In the LEC NPWS did not concede the roads claim, and on a proper construction of their submissions, said that CCS had no rights in the roads. 6 These submissions did not relate to the manner in which NPWS conducted the appeal. NPWS did not take a combative position in the appeal at any stage, but filed a Notice of Appearance on 21 January 2004 submitting to the order of the Court save as to costs. NPWS maintained the position of submitting respondents throughout proceedings in the appeal. 7 The power to order costs is discretionary: see Supreme Court Act 1970 s.76(1). The ordinary course is that costs follow the event: see Supreme Court Rules Pt.52A r.11. Part 52A r.12 provides: (1) Subject to rule 14, where a respondent or opponent adds to that party's notice of appearance a statement pursuant to Part 51 rule 20 and Part 51AA rule 13B (which relate to a submitting appearance) and takes no active part in the proceedings, the appellant or claimant shall, unless the Court otherwise orders, pay the respondent's or the opponent's costs as a submitting party.

(2) Any costs that an appellant or claimant is liable to pay pursuant to subrule (1) to a submitting party properly joined in proceedings shall, unless the Court otherwise orders, be included in any costs payable by any other respondent or opponent to the appellant or claimant in respect of those proceedings. 8 Rule 12 applies in this case as NPWS took no active part in the proceedings on appeal. NPWS do not ask for an order for their own costs as submitting parties. It would plainly be inconsistent with r.12 for the appellant to recover an order for costs to the appeal unless the Court as a matter of discretion and for sufficient grounds decided to make such an order. 9 In my opinion the grounds put forward in support of the application are not grounds on which a discretionary order for payment by NPWS of the costs of the appeal should be made because they do nothing to take the claim for costs out of the ordinary course indicated by r.12. 10 In my opinion each party to the appeal should pay his or its own costs of the appeal and the Court of Appeal should so order. 11 In the proceedings in LEC Cowdroy J, on the facts and circumstances before him, had sound reasons for excepting the costs of the claim for a declaratory order from the order that NPWS pay CCS's costs in that court, because that part of CCS's claim had failed. From the reasons given by Cowdroy J on 5 December 2003 it seems that his Honour treated making this exception as a matter of course, and his Honour gave detailed attention to whether there should be a Sanderson Order or a Bullock Order dealing with the costs of the sixth respondent. As the Court of Appeal has decided that the declaratory order should have been made, Cowdroy J's decision to make this exception should be set aside, and the costs to which the exception related should be reconsidered. 12 In the LEC, CCS claimed a declaratory order establishing that it had an interest in fee simple in the roads in Pacific City Estate: Cowdroy J refused CCS's claim for the declaration, although he granted other relief. The claim for a declaration was an important part of the controversy about whether CCS could compel NPWS to resume CCS's estate in the roads. 13 The declaratory order sought could not be made by consent of parties. Cowdroy J's decision to make the exception was, in the circumstances before him, rightly treated as a matter of course. A decision in the opposite sense requiring that a party whose presence on the record was necessary because that party was interested in a claimed declaratory order is not a matter of course. A party in that position cannot end the litigation and the claim for a declaratory order by consenting to it. The Court does not make declaratory orders simply on the consent of parties. If such a party actively opposes a claim for a declaratory order and fails, payment of costs would be the usual discretionary outcome. If such a party submits to the claim in the proceedings or does not oppose the claim it does not follow without more that the party will be ordered to pay the plaintiff's costs. There may be grounds in the facts leading up to the litigation or during its course which lead the Court to a discretionary decision to order costs, but if the defendant has not opposed a claim and had not precipitated the litigation, an order for costs would not follow as a matter of course on a successful claim for a declaratory order. 14 In my opinion LEC is in a better position to form a judgment overall on whether anything happened before or during the proceedings in LEC which put NPWS into a combative position, and whether there is a sound ground for requiring NPWS to pay CCS's costs in that court. This would require a survey of the whole course of the litigation, including any indication at a preparatory stage that NPWS disputed the claim relating to the roads, the circumstances and the exact terms of the indication which, according to CCS's submissions, was given shortly before the hearing began, and the part actually taken by NPWS at the hearing and in written submissions. Unless NPWS in some way precipitated the claim for a declaratory order or took a contentious position I would not think that an order for costs of the part of the proceedings relating to the declaratory order would be the usual outcome. 15 The statement in Morton & Harris letter of 20 December 2004 to the effect that the costs now under consideration are a six-figure sum is quite alarming. What has been seen in the Court of Appeal of the evidence could not possibly support an award of costs in that order. It would be necessary, if the Court of Appeal were to dispose of the costs, to call for evidence showing how much money is involved in the claim for a costs order and how the claim is calculated. Rather than set the usual processes of assessment in train I would for myself consider whether to make a lump sum assessment and specify the lump sum in the order for costs, if there were to be an order. It would be unjust to set in train a process of assessment which could, even possibly, lead to an allowance of a six-figure sum for costs, unless the Court clearly understood how much money it was disposing of. 16 When disposing of the appeal the Court was composed of Ipp JA, Bryson JA and Cripps AJA. The appointment of Cripps AJA has expired and the question of costs has been determined by the Court composed of Ipp JA and Bryson JA, with the consent of the parties affected and in accordance with Supreme Court Act 1970 s.45AA. 17 In my opinion the Court of Appeal should make the following order as to costs:

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