The Trustees of the Roman Catholic Church for the Diocese of Broken Bay v... [2023] NSWLEC 88 | Case summary

Land and Environment Court (NSW)|2023-08-23|Before: Robson J

Judgment

By notice of motion filed 9 August 2023, Willoughby City Council ('Council'), the respondent in the primary Class 1 proceedings, sought orders for the striking out or summary dismissal of contentions 1 and 10 of the statement of facts and contentions ('SOFAC') filed on 14 July 2023 by the Trustees of the Roman Catholic Church for the Diocese of Broken Bay (for concision, 'Diocese'), the applicant in the proceedings. In the alternative, Council sought orders that the hearing dates (set down for two days on 25 and 26 September 2023) be vacated, or that three additional days be allocated for the substantive hearing of this matter in order to allow it to respond to contentions 1 and 10.
The primary proceedings relate to a Class 1 appeal brought pursuant to s 30 of the Heritage Act 1977 (NSW) ('Heritage Act') by the Diocese against the making by Council on 26 May 2023 of an interim heritage order ('IHO') applying to part of a site located at 43 Donnelly Road, Naremburn, pursuant to s 25(2) of the Heritage Act.
The motion was listed for hearing before me on 23 August 2023. The Diocese read the affidavit of Amelia Galina Adams affirmed 18 August 2023, and the exhibit annexed thereto. Council read the affidavit of Patrick Michael Shumack affirmed 9 August 2023 and the exhibit annexed thereto.
Early during the hearing, senior counsel for the parties informed the Court that an agreement had been reached which effected a resolution of all issues in the motion (but for costs).
Orders were made by consent reflecting the agreement that the Diocese's SOFAC filed 14 July 2023 (and the subject of the orders in the motion) was amended in such a way as to address the primary issues of Council.
As Council sought its costs of the motion, the remaining issue is therefore whether costs should be awarded, and if so, to whom.

Submissions

At the conclusion of the hearing (and the agreed orders providing, inter alia, for the amended statement of facts and contentions ('ASOFAC') being made), the parties provided short oral submissions on costs.
The Diocese submitted that Council's conduct in moving a motion to strike out pursuant to Pt 14 of the Uniform Civil Procedure Rules 2005 (NSW) ('UCPR') was inappropriate insofar as these provisions do not provide a proper statutory basis to "strike out" contentions in a class of proceedings that does not have pleadings. Instead, Council should have simply raised its concerns in a statement of facts and contentions in reply. In addition, the Diocese emphasised that it had, by letter dated 14 August 2023, provided Council with an alternative version of the disputed contentions which went some way to resolve the issues that led to the motion without proceeding to hearing. In these circumstances, it submits that it is entitled to its costs of the motion.
Council similarly claims to be entitled to its costs of the motion. It submits it has effectively obtained the relief it sought in the motion. It rejected the Diocese's submission that its reliance on the UCPR was inappropriate and submits in any event that s 23 of the Land and Environment Court Act 1979 (NSW) ('Court Act') covers the field by enabling this Court to make any orders it considers appropriate for the conduct of the proceedings.

Relevant legal principles

This Court's power to award costs of the proceedings arises pursuant to s 98(1) of the Civil Procedure Act 2005 (NSW) and r 3.7 of the Land and Environment Court Rules 2007 (NSW) ('Court Rules').
Insofar as these proceedings are within Class 1 of the Court's jurisdiction (see Court Act, s 17(d)), they are subject to the presumptive rule set out in s 3.7 of the Court Rules, wherein an order for costs should not be made unless the Court considers it "fair reasonable in the circumstances".
While the principles applicable to the Court's exercise of the power under r 3.7 of the Court Rules are well-known and not repeated, I note the words of Spigelman CJ in Port Stephens Council v Jeffrey Sansom [2007] NSWCA 299; (2007) 156 LGERA 125 at [48]: "The starting point must be the presumptive rule that there will be no order as to costs. It is in that context that the power to make an order for costs is conferred in the broadest of terms i.e. what is "fair and reasonable … in the particular circumstances". There is no restriction, other than rationality, on the scope of the considerations relevant to the formulation of that judgment. However, those considerations must be, in the opinion of the first instance judge, of sufficient weight to overcome the presumptive rule."
Although r 3.7(3) of the Court Rules provides a non-exhaustive list of circumstances in which an order for costs may be fair and reasonable, those indicia demonstrate considerations that could be broadly described as relating to matters out of the usual course of a merit proceeding, they may provide assistance when evaluating whether an order for costs is fair and reasonable. Despite this, the power exercised by the Court is not confined to those matters and is instead in the broadest of terms.
Ultimately, the question guiding my consideration is whether, the circumstances and the conduct of the parties are of sufficient weight to overcome the presumptive rule.

Findings

Applying the principles summarised above, I have formed the view that neither party has established that any order as to costs would be fair and reasonable in the circumstances. My reasons may be shortly stated.
First, I consider that Council's concern over the relevance (and wording) of contentions 1 and 10 was appropriate in circumstances where it submits, and I find, that these contentions (especially certain particulars of contention 1) raised matters that on one persuasive view were effectively seeking relief in the nature of judicial review (that is, effectively challenging the IHO itself). Further, while I am not suggesting that the Diocese's articulated concern regarding the conduct of Council (and at least one councillor) was not legitimate or, at the very least, honestly held, I consider that contention 1 in particular, raised matters as then expressed that would have been more appropriately and properly progressed in Class 4 proceedings - which if such proceedings had been successful, a matter about which I cannot form an opinion and indeed express no view, would likely have been collaterally determinative of the present Class 1 appeal.
Despite this, the Diocese chose to articulate the contentions in this way as part of this Class 1 appeal and Council's conduct both in relation to its correspondence with the Diocese and the bringing of the motion (which on one view was unconventional) was not without some good basis.
Second, despite the Diocese's submissions, I find that proceeding by way of a notice of motion to strike out, whilst unconventional, was an appropriate response to address Council's concerns. This is so because, despite the limited application of Pt 14 of the UCPR to proceedings in Class 1 of the Court's jurisdiction, s 23 of the Court Act would empower the Court to make any order "it thinks appropriate", including in relation to orders sought in a motion to strike out.
Third, as it is relevant for this Court to consider the parties' conduct both before and during the hearing, having read the correspondence between the parties, which was annexed to Ms Adam's affidavit, it is clear that the Diocese attempted to resolve the matter without litigation by proposing an amended SOFAC if the motion was withdrawn. I have considered the then proposed amended SOFAC and note that it purports to address Council's concerns by, inter alia, removing certain particulars in contention 1 relating to a particular councillor's involvement with the IHO and an alleged conflict of interest; and by removing the allegation that the IHO was a "brazen misuse of the IHO process …" in contention 10. Tellingly, these were particulars which Council submitted should be struck out during the hearing of the motion and which were ultimately deleted from the ASOFAC filed by agreement on 23 August 2023.
Fourth, I find that the ASOFAC filed on 23 August 2023 as a result of agreement between the parties is a further iteration of that proposed to be filed by the Diocese in an attempt to settle the motion ahead of the hearing.
On balance, while I accept that Council had a justifiable reason for bringing the notice of motion, I find that the Diocese behaved appropriately by seeking to address and resolve those concerns prior to and during the hearing. While I congratulate the parties for resolving the issues the subject of the motion, I note that such an outcome could have been reached prior to the hearing and without the not inconsiderable costs that would have been incurred by both parties. In these circumstances I do not consider that an order for costs in favour of either party would be either fair or reasonable so as to rebut the presumptive rule in r 3.7(2) of the Court Rules.

Orders

The orders of the Court are: 1. Leave is granted for The Trustees of the Roman Catholic Church for the Diocese of Broken Bay to file an amended statement of facts and contentions dated 23 August 2023. 2. The notice of motion filed 9 August 2023 is withdrawn. 3. No order as to costs of and in relation to that notice of motion.

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: 25 August 2023

(2007) 156 LGERA 125

The Trustees of the Roman Catholic Church for the Diocese of Broken Bay v Willoughby City Council

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