True Conservation Association Incorporated v The Minister administering the... [2008] NSWLEC 221 | Case summary

1 HIS HONOUR: The applicant applies for an order for costs of these proceedings that have been dismissed by consent. The respondent opposes such an order and submits instead that each party should pay their own costs of the proceedings. The proceedings involved judicial review of an order of the respondent dated 11 December 2007 conferring biodiversity certification on the State Environmental Planning Policy (Sydney Region Growth Centres) 2006 ("Growth Centres SEPP") under s 126G of the Threatened Species Conservation Act 1995 (NSW). 2 The applicant commenced the proceedings on 6 March 2008. On 2 May 2008, the applicant filed its points of claim. Three grounds of review were articulated: first, notice of the proposed biodiversity certification of the Growth Centres SEPP had not been given in accordance with the s 126G(4)(a) of the Threatened Species Conservation Act 1995; secondly, the Minister's purported opinion of satisfaction did not constitute the state of satisfaction required by s 126G(1) of the Act; and thirdly, the Minister's exercise of discretion under s 126G(1) was manifestly unreasonable. 3 The respondent filed points of defence on 22 May 2008 joining issue with the applicant's grounds of challenge. On 23 May 2008, the proceedings were fixed for hearing on 29-31 July 2008. 4 Before the hearing could take place, however, legislation was passed which had the effect of conferring biodiversity certification on the Growth Centres SEPP. The Threatened Species Conservation Amendment (Special Provisions) Bill 2008 was introduced into the Legislative Assembly on 18 June 2008 on a motion by Mr Nathan Rees. Debate was adjourned to 25 June 2008. On that day, Ms Verity Firth, whose portfolio as Minister for Climate Change and the Environment includes the Threatened Species Conservation Act 1995, replied. The Bill was passed and transmitted to the Legislative Council. 5 Later that same day, the Honourable Henry Tsang moved the second reading of the Bill in the Legislative Council. Debate followed. The Legislative Council resolved that the Bill be read a second time, as well as being read a third time, and the Bill was returned to the Legislative Assembly without amendment. The Legislative Assembly subsequently passed the Bill. The Governor assented to the Threatened Species Conservation (Special Provisions) Act 2008 on 1 July 2008. 6 On 16 July 2008, the respondent filed a notice of motion seeking that the proceedings be dismissed and that there be no order as to costs. On 23 July 2008, Sheahan J, by consent of both parties, ordered that the proceedings be dismissed but listed the question of the costs of the proceedings to be heard today. 7 The applicant submits that the respondent should pay the applicant's costs of the proceedings. It submits that the respondent promoted the Bill that was passed by Parliament and which rendered inutile the proceedings. The legislation did not directly validate the respondent's order of 11 December 2007 but rather effected an alternative means of conferring biodiversity certification on the Growth Centres SEPP. 8 This was achieved by inserting a new part, Pt 7 of Sch 7, in the Threatened Species Conservation Act 1995, which conferred biodiversity certification on the Growth Centres SEPP. The applicant's judicial review challenge to the Minister's order could theoretically still proceed and the court could determine it. However, there was no practical utility in doing so. Even if the court were to uphold the applicant's challenge to the Minister's order, biodiversity certification would still be conferred independently on the Growth Centres SEPP by the new Pt 7 of Sch 7 to the Threatened Species Conservation Act 1995. Hence, the practical effect of the legislation was to render the proceedings inutile. 9 The applicant submitted that the respondent was a promoter of that legislation and such conduct is sufficient to justify the court ordering that the respondent compensate the applicant for its costs of the proceedings thrown away by reason of the proceedings being rendered inutile. 10 The applicant referred to the discussion in Kiama Council v Grant (2006) 143 LGERA 441 of the two types of cases referred to by Burchett J in One.Tel Ltd v Commissioner of Taxation (2000) 101 FCR 548. The applicant accepted that the first type of case, namely where one party effectively surrenders to the other without there being a hearing and determination on the merits, was not applicable to the facts of this case. There had been no surrender by either party to the other party. Rather, the applicant submitted, the case was of the second type of case referred to by Burchett J in One.Tel, namely where there was a supervening event that so removed the subject of the dispute that no issue remained except for costs. In this case, the supervening event was the passage of the legislation conferring biodiversity certification on the Growth Centres SEPP. 11 The applicant noted that in this situation, the authorities, particularly Re Minister for Immigration and Ethnic Affairs; ex parte Lai Qin (1997) 186 CLR 622, hold that ordinarily the proper exercise of the costs order will be to make no order as to costs, except in certain circumstances. Two circumstances were referred to in para 80 of the decision in Kiama Council v Grant (2006) 143 LGERA 441 at 457-458. Neither circumstance applies to the facts in this case. Nevertheless, the applicant submits, these circumstances are not exhaustive of the situations where it would be proper to order costs. The applicant submits that the circumstances in this case, namely the passage of the legislation, are sufficient to justify departing from the ordinary position that there be no order as to costs. 12 The respondent opposes an order for costs. The respondent submits that the starting position is that stated in Pt 42, r 42.20(1) of the Uniform Civil Procedure Rules 2005 which provides: "If the court makes an order for the dismissal of proceedings, either generally or in relation to a particular cause of action or in relation to the whole or part of any claim, then, unless the court orders otherwise, the plaintiff must pay the defendant's costs of the proceedings to the extent to which they have been dismissed." 13 The respondent refers to two cases which discuss this position, namely Fordyce v Fordham (2006) 67 NSWLR 497 at 511 [78] and Australiawide Airlines Limited v Aspirion Pty Ltd [2006] NSWCA 365 at [48] and [53]. The respondent accepts that in the circumstances of this case, it would be proper for the Court to depart from the position in Pt 42, r 42.20(1) that the applicant pay the respondent's costs and, instead, the proper order is that each party should pay their own costs: see Fordyce v Fordham (2006) 67 NSWLR 497 at 515 [97]. 14 The respondent submits that the Court cannot determine that the applicant would almost certainly have succeeded if the litigation had continued. No material was put before the Court by the applicant on this cost application to enable the Court to so determine and, in any event, the Court would not so find. The respondent submits that there is no relevant disentitling conduct of the respondent in this case. Parliament is not to be equated with the respondent. Parliament passed the legislation; it was not a unilateral act of the respondent. It cannot be said that the legislation in terms was unreasonable or that the conduct of passing the legislation was unreasonable. 15 I agree with the respondent's arguments. The position is that both parties acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the further prosecution of the litigation became inutile by Parliament passing the legislation. The passing of the legislation was not relevantly conduct of the respondent; it was of both houses of Parliament. It also cannot be said to be unreasonable conduct. Furthermore, it cannot be said that the applicant would almost certainly have succeeded if the matter had been tried so that the applicant should obtain its costs of the proceedings. 16 The cases in the administrative law matters where there has been a supervening event, such as the re-exercise of power rendering further prosecution of a challenge to a prior exercise of power futile, support the proper exercise of the cost discretion being to make no order as to costs: see Re Minister for Immigration and Ethnic Affairs; ex parte Lai Qin (1997) 186 CLR 622 and the cases referred to in paras 73-77 of Kiama Council v Grant (2006) 143 LGERA 441 at 456-457 as well as the summary of principles in para 80 of that case at 457-458. 17 As was noted in Fordyce v Fordham (2006) 67 NSWLR 497 at 515 [97], this is a case in which neither party won nor lost. Rather, the proceedings became futile by reason of Parliament passing the legislation. The appropriate cost order is that each party should pay their own costs of the proceedings. I consider this also should be the order in relation to the respondent's motion filed 16 July 2008. 18 Accordingly, the Court orders:

True Conservation Association Incorporated v The Minister administering the Threatened Species Conservation Act 1995

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Judgment (11 paragraphs)

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