(1997) 186 CLR 622
Kiama Council v Grant [2006] NSWLEC 96
(2006) 143 LGERA 441
Latoudis v Casey [1990] HCA 59
Source
Original judgment source is linked above.
Catchwords
Ex parte Lai Qin [1997] HCA 6(1997) 186 CLR 622
Kiama Council v Grant [2006] NSWLEC 96(2006) 143 LGERA 441
Latoudis v Casey [1990] HCA 59
Judgment (12 paragraphs)
[1]
SOLICITORS:
Wilshire Webb Staunton Beattie (Applicants)
Doyle Edwards Anderson (First to Third Respondents)
Atkinson Vinden (Fourth Respondent)
File Number(s): 41040 of 2011
[2]
Judgment on costs
The Third Applicant is the strata owner of Strata Plan No 69470 a multilevel mixed commercial and residential development in Manly. The First and Second Applicants Mr and Mrs Wallace own one of the units in the development. The First and Second Respondents owned a restaurant China Beach Restaurant Pty Ltd, the Third Respondent which operated on the ground floor. The Fourth Respondent Atcha Pty Ltd the incoming purchaser of the restaurant was joined late in the proceedings and no costs issues arise with respect to it. Any references to the Respondents does not include the Fourth Respondent. The Applicants commenced these Class 4 proceedings seeking to restrain breaches of the Environmental Planning and Assessment Act 1979 (NSW) ("EPA Act") on the basis the restaurant was not being conducted in accordance with the relevant development consent. The transmission of odour and noise particularly in the Wallaces' unit were in issue.
On 12 March 2013 the Court made final orders by consent ("March 2013 Orders"). The matter was relisted and additional orders were made by the Court by consent on 30 October 2014 ("October 2014 Orders"). On 16 October 2015 the Court made further orders by consent ("October 2015 Orders") in relation to competing Notices of Motions filed by the parties concerning further working out of the March 2013 and October 2014 Orders. The only outstanding issue is costs.
The Applicants seek orders that:
1. the Respondents pay the Applicants' costs which were reserved pursuant to Order No 10 of the October 2014 Orders;
2. the Respondents pay the Applicants' costs of the Applicants' Notice of Motion filed 11 March 2015 and the Applicants' Amended Notice of Motion filed 24 August 2015;
3. the Respondents pay the Applicants' costs of the Respondents' Notice of Motion filed 20 April 2015 and the Respondents' Amended Notice of Motion filed 14 August 2015; and
4. the Respondents pay the Applicants' costs of the subject argument on costs.
The Respondents seek orders that:
1. each party pay its own costs reserved pursuant to order 10 dated 30 October 2014;
2. the Applicants pay the Respondents' costs of the Applicants' Notice of Motion filed 11 March 2015 and the Applicants' Amended Notice of Motion filed 24 August 2015 on an ordinary basis up to and including 5pm on 15 October 2015 and on an indemnity basis thereafter;
3. the Applicants pay the Respondents' costs of the Respondents' Notice of Motion filed 20 April 2015 and the Respondents' Amended Notice of Motion filed 14 August 2015 on an ordinary basis up to and including 5pm on 15 October 2015 and on an indemnity basis thereafter;
4. the Applicants pay the Respondents' costs of the costs argument.
[3]
Evidence
The Applicants relied on the following evidence:
1. affidavit of K Webber (Applicants' solicitor) sworn 30 April 2014 Annexure II to VV;
2. affidavit of K Webber sworn 14 September 2015 Annexures G to K;
3. affidavit of R Wallace (First Applicant) sworn 29 May 2015 Annexure A;
4. affidavit of R Wallace sworn 10 September 2015 Annexures A and B;
5. affidavit of G Doyle (First to Third Respondents' solicitor) sworn 6 October 2015;
6. affidavit of G Doyle sworn 6 October 2015;
7. affidavit of S Anastasiou (First Respondent) sworn 22 May 2015 pars 17-29 and the annexures referred to therein.
The Respondents relied on the following evidence:
1. affidavit of G Doyle sworn 2 November 2015,
2. affidavit of G Doyle sworn 6 October 2015 (shorter) pars [3] to [7] and Annexure B;
3. affidavit of G Doyle sworn 6 October 2015 (longer) Ex G9D1 (Ex 2) Tabs 5, 6, 7, 8, 9, 11, 12, 13 and 14;
4. affidavit of S Anastasiou sworn 22 May 2015 pars [17] to [20], [25] to [35], and SAA 1 (Ex 1) Tabs 1 to 13;
5. affidavit of K Webber sworn 30 April 2015 Annexures RR to VV;
6. affidavit of K Webber sworn 14 September 2015 Annexures A to J;
7. affidavit of R Wallace sworn 21 April 2015 Annexures AG-10AF; and
8. affidavit of R Wallace sworn 10 September 2015 pars [14] to [18], [22] to [24], Annexure A.
The Applicants' summons commencing these Class 4 enforcement proceedings sought declarations of breaches of conditions of development consent by the First, Second and Third Respondents in prayers 1 and 2. Prayer 3 sought an order that those respondents comply by undertaking 22 actions related to compliance with the same number of consent conditions. The alleged breaches related to noise, air pollution, fire and BCA certification, ventilation, garbage room/grease arrestor room floors to be graded and drained, and odour inter alia.
[4]
Court orders March 2013 and October 2014
Court orders made by consent on 12 March 2013 stated:
1. The Respondents to do the work and fulfil their obligations as set out in, and in accordance with, the Schedule below.
2. That the Applicants cooperate fully to give effect to the Schedule below in accordance with the Schedule.
3. That the Respondents are to pay the Applicants' costs of the proceedings as agreed or assessed.
4. That the Summons is otherwise dismissed.
5. Grants liberty on 3 days notice to apply to restore to the list for the purpose of giving effect to or working out these orders, which includes seeking an extension of time to carry out work required under the Schedule.
A summary of the Schedule referred to in order 1 follows:
1. Initial works - The Respondents are to build up the masonry shaft for the kitchen exhaust to the specifications, and associated works.
2. Engagement of experts - The Parties are to appoint a joint acoustic expert, odour expert and a Building Code of Australia (BCA) certifier, with each to prepare a report prior to and after the completion of the recommended works. The Respondents are to pay the fees and disbursements of the experts.
3. Recommended works
1. The Respondents at their own cost are to:
1. within 21 days of the first reports of each of the experts make applications for and pursue all necessary approvals to undertake the works;
2. lodge any necessary appeal to the Land and Environment Court 45 days after making any development application;
3. within 28 days of the receipt of the necessary approvals or if there are none, within 28 days after service of the first reports of each of the experts, undertake and complete the works recommended by each of the experts;
4. if the second report by any of the three experts identifies in its schedule work to be completed to ensure compliance with the first report of that expert, the Respondents are to carry out that work within 28 days of the receipt of the schedule; and
5. maintain all works in accordance with the recommendations of the experts in their first reports.
1. The Applicants at their own cost are to:
1. take all steps and do everything reasonably required by the Respondents to facilitate the Respondents fulfilling their obligations as set out above, provided that to the extent practicable access to the roof is to be obtained through a manhole; and
2. grant and cause the Residential Owners Corporation to grant all permissions and consents that the Respondents reasonably request to enable the Respondents to fulfil their obligations set out above, with the Respondents' obligations suspended until permissions and consents are granted.
1. Maintenance work - the Respondents shall provide to the building's building management committee evidence of maintenance in accordance with the first reports of the three experts, within 14 days of carrying out that maintenance. Failure to provide evidence of maintenance is prima facie evidence that the maintenance has not been carried out.
2. Installation of plant and equipment on the roof above the Wallaces' unit:
1. The parties agree that the Acoustic and Odour Experts are at liberty to consider whether any plant and equipment should be installed on the roof.
2. To the extent that the Acoustic or Odour works involve or require work to be carried out on the roof, then:
1. any plant and equipment may be installed on the roof (but not above the Wallaces' bedrooms);
2. the Applicants shall ensure that the Respondents are granted an easement to install, keep and maintain such plant and equipment on the roof; and
3. the Respondents shall pay all reasonable costs of granting the easement including the Applicants' reasonable legal costs, but not the value of the easement itself.
After the matter was returned to the Court by the Applicant, orders were made by consent on 30 October 2014. A summary follows:
1. Orders are supplementary to the orders made by the Court on 12 March 2013 and are made for the purpose of working out those orders.
2. The Respondents are to carry out or cause to be carried out the works to:
1. the grease trap/arrestor room as described in the report of Mr Halstead, BCA Certifier, dated 6 November 2013;
2. the garbage room as described in the report of Mr Halstead, BCA Certifier, dated 6 November 2013;
3. the extension of the fire rated shaft and the repair of the duct as described in the report of Mr Halstead, BCA Certifier, dated 6 November 2013; and
4. the kitchen ventilation/odour as described in the report of Mr Turvey, mechanical ventilation expert, dated 30 September 2014.
1. Costs of the working out of the March 2013 Orders including the hearing on 30 October 2014 to be reserved.
[5]
2015 Notices of Motion
Most of the work required by the October 2014 Orders had to be completed within either 25 or 60 days of those orders. The Applicants filed a Notice of Motion dated 11 March 2015. The orders sought were:
1. The Respondents carry out the Work set out in the schedule within 14 days ("the Work").
2. If the Respondents fail to comply with Order 1 then:
(a) the Applicants and their agents may carry out the Work;
(b) the Respondents shall do all things necessary to give the Applicants and their agents access to the Respondent's premises for the purposes of carrying out the Work;
(c) the Respondents shall not hinder or harass the Applicant's agents or contractors or the retained experts;
(d) in carrying out the Work the Applicants and their agents shall cause as little disruption as possible to the business being conducted by the Respondents;
(e) the Respondents shall bear the costs of the Work;
(f) for the purpose of securing the Respondent's obligation in subparagraph (e) hereof the Respondents shall within 14 days of these Orders (assuming the Respondents are in breach of Order 1) pay to the Applicant's solicitor the sum of $100,000.00 which shall be held in the Applicant's solicitor's trust account subject to the following provisions;
(g) the Applicant's solicitors may apply the sum received from the Respondents in payment for the Work upon receipt of any proper invoice for the carrying out of the Work.
(h) within 7 days of receiving notice from the Applicants' legal representative that the amount held in trust has been reduced to an amount less than $25,000, the Respondents are to pay a further $50,000 to the Applicants' solicitors' trust account.
3. The Respondents shall within 7 days pay all outstanding invoices to retained experts, Gary Graham and Roger Turvey.
4. In the alternative to Orders 1 and 2:
(a) that the Respondents on and from 30 March 2015 cease to carry on the business of the restaurant or café at Lot 2 SP69948 43-45 North Steyne, Manly ("Lot 2") whether under the name China Beach or otherwise;
(b) that by 12 April 2015 the Respondents remove from Lot 2 all fixtures and fittings within the building which relate to the use of Lot 2 as a restaurant including, without limiting the foregoing, the kitchen exhaust system and kitchen hoods and in so doing the Respondents shall make good any damage caused to any premises outside Lot 2 including common property;
(c) by 12 April 2015 do all things necessary to surrender:
(i) development consent number DA 48/2009 originally granted on 10 July 2009 by Manly Council;
(ii) development consent number DA 119/2003 originally granted by Manly Council on 7 July 2003.
for the purposes of (a), (b) and (c) above, the Respondents shall provide access to the premises at Shop 2 to the Applicant or their Agents and shall provide to the Applicants written verification of compliance with (c) above by 12 April 2015.
5. The Respondents are to have completed by 12 April 2015 the outstanding works described by Nathan Halstead including the replacement of the garbage room door with a door consisting of perforated openings of at least 5% of the total area of both garbage rooms and a fire seal of the shaft at the shop ceiling level so that there is fire separation from the residential units.
6. If the Respondents fail to comply with orders 4(b) and/or 5 above then the provisions of order 2(a) to (e) inclusive shall apply.
In relation to all of the above
7. The hearing of the motion be expedited.
8. The Respondents pay the Applicant's costs since 12 March 2013 including all reserved costs.
9. The Respondents are to provide the Applicant's solicitor a copy of any Contract for Sale of Lot 2 within 3 working days of entering into such a Contract for Sale.
10. Liberty granted on three days' notice to apply to restore to the list for the purpose of giving effect to or working out these orders.
The schedule in prayer 1 of the Notice of Motion is the Schedule referred to in the orders.
The terms of the Applicants' Amended Notice of Motion filed on 24 August 2015 were:
1. The First, Second and Third Respondents are to carry out the following work;
(a) The outstanding works described and recommended by Nathan Halstead in his report dated 6 November 2013 that have not been satisfactorily completed including; replacement of the garbage room door of both garbage rooms and a fire seal of the shaft at the slop ceiling level so that there is fire separation from the residential units within 21 days.
(b) The works described in order 5 of the Orders made on 30 October 2014 and entered 6 November 2014 within 28 days.
2. The First, Second and Third Respondents are to
(a) carry out or caused to be carried out
(i) so much of the stage 1 works described in the Report of Roger Turvey dated 30 September 2014 ("Turvey 2014 Report") as is practicable.
(ii) The stage 2 works described in the Turvey 2014 Report and detailed and expanded upon in the Roger Turvey Report of 20 January 2015 ("Turvey 2015 Report").
subject to any modification or amendments as recommend by Roger Turvey.
Or as an alternative to order 2(a)
(b) the First, Second and Third Respondents are to carry out or cause to be carried out the works described in the Report titled "specification for new kitchen ventilation system for ground floor commercial tenancy No 2, 43 - 45 North Steyne Manly NSW" prepared by Richard Duggan Pty Ltd Rev B dated 2.7.2015 ("The Duggan Report").
3. The works described in order 2(a) or 2(b) above are to be completed within 60 days.
4. Any defects in the work referred to in order 2(a) as is determined by Mr Turvey are to be rectified within 30 days.
Any defects in the work referred to in order 2(b) as is determined by Mr Duggan are to be rectified within 30 days.
5. Upon completion of the works described in order 2(a) or 2(b) compliance certification is to be provided for the work in relation to:
(i) Ventilation
(ii) Acoustic
(iii) Odour omission.
6. All costs associated with orders 1, 2, 4 and 5 are to be paid by the First, Second and Third Respondents.
7. Until such time as the works described in order 2 have been satisfactory completed including rectification of any defects and certification as set out in order 5 provided, the First, Second and Third Respondents shall not operate or carry on a business of a restaurant or café at Lot 2 SP 69948, 43 - 45 North Steyne, Manly under the name China Beach or otherwise.
8. In the alternative to orders 2, 3, 4, 5 and 7 the First, Second and Third Respondents shall:
(a) not carry on a business of a restaurant or café at Lot 2 SP69948 43-45 north Steyne Manly ("Lot 2") whether under the name China Beach or otherwise.
(b) remove from lot 2 all fixture and fittings which relate to the use of lot 2 as a restaurant including all associated kitchen infrastructure.
(c) within 14 days do all things necessary to surrender;
(i) development consent number DA 48/2009 originally granted on 10 July 2009 by Manly Council;
(ii) development consent number DA 119/2003 originally granted by Manly Council on 7 July 2003.
and shall provide to the Applicants written verification of compliance with (b) above within 21 days.
In relation to all of the above
9. The First, Second and Third Respondents pay the Applicant's costs since 12 March 2013 including all reserved costs and this motion.
The Respondents filed a Notice of Motion dated 20 April 2015 seeking the following orders:
1. The date in order 3 of the orders dated 30 October 2014 ("the October Orders) for completion of compliance with orders 2(b) and (c) of the October Orders be extended to 28 days from the date of this order;
2. Within 28 days the Respondents shall complete the replacement of the garbage room door with a door consisting of perforated openings of at least 5% of the total area of the garbage room floor areas;
3. The date for completion of compliance with order 5 of the October Orders be extended to 28 days from the date of this order;
4. Given the mechanical kitchen exhaust fan system ("the Exhaust System") has been fully removed from the subject property since the October Orders:
(a) orders 7, 8 and 9 of the October Orders be set aside, vacated and/or varied as set out hereunder;
(b) within 14 days the respondents shall appoint their own mechanical ventilation/air services expert to:
(i) carry out any further inspection of the building considers necessary in the manner contemplated by order 5.2 of the orders made on 12 March 2013 ("the March Orders");
(ii) prepare a report addressing whether or not it remains practical and necessary for the Respondents to perform the work set out in orders 7 and 8 of the October Orders in the light of the following:
(A) the Exhaust System has been fully removed from the subject property since the October Orders;
(B) the absence of the Exhaust System from the subject property makes any proposed testing of the Exhaust System impracticable; and
(C) any replacement of the Exhaust System will be required to comply with Development Conditions ANS06, ANS07, DA80 and DA223 in any event,
and, if so, recommending what remaining work is required;
(c) The applicants shall within 14 days of receipt of the report in order 4(b) appoint their own mechanical ventilation/air services expert to:
(i) carry out any further inspection of the building they consider necessary in the manner contemplated by order 5.2 of the orders made on 12 March 2013 ("the March Orders");
(ii) prepare a report responding to the report in order 4(b) and addressing whether or not it remains practical and necessary for the Respondents to perform the work set out in orders 7 and 8 of the October Orders in the light of the following:
(A) the Exhaust System has been fully removed from the subject property since the October Orders;
(B) the absence of the exhaust System from the subject property makes any proposed testing of the Exhaust System impracticable; and,
(C) any replacement of the Exhaust System will be required to comply with Development Conditions ANS06, ANS07, DA80 and DA223 in any event,
and, if so, recommending what remaining work is required;
(d) for the purposes of orders 4(b) and 4(c), both Experts are to be provided with:
(i) the documents referred to in order 5.1 of the March Orders; and,
(ii) the Turvey Sept 2014 report;
(e) Within 14 days of service of the report in order 4(c), the experts are to participate in a conclave in order to agree and prepare a joint scope of works to be undertaken arising from the reports prepared pursuant to orders 4(b) and 4(c) ("the Remaining Work") and the Respondents shall thereafter promptly perform the Remaining Work in the manner contemplated by orders 11.1 to 11.4 of the March Orders;
(f) If the experts at the conclave cannot agree on a joint scope of works, the parties have liberty to approach the Court to have the proceedings relisted to determine the scope of works based on the reports of the experts prepared pursuant to orders 4(b), (c) and (e);
(e) orders 12, 13 and 16 of the March Orders shall apply to the Remaining Work;
(f) The Applicants and the Respondents are to bear their own costs of complying with this order 4; and;
(g) The First to Third Applicants shall not unreasonably interfere with the rights of the benefitted owner as set out in terms of easement, eleventhly referred to in the registered dealing document DP 1047991.
5. The Third Applicant forthwith reimburse to the Respondents all costs and expenses incurred by the Respondents in removing wiring from the exhaust shaft.
6. The parties must in good faith co-operate with the experts appointed pursuant to these orders to enable them to prepare the necessary reports, including but not limited to, provision of access to the experts to all parts of the building at any time between 7am and 6pm upon 1 days notice as the appointed expert may request.
7. The applicants to pay the respondents' costs of this Notice of Motion.
The terms of the Respondents' Amended Notice of Motion filed on 14 August 2015 were:
1. The date in order 3 of the orders dated 30 October 2014 ("the October Orders") for completion of compliance with orders 2(b) and (c) of the October Orders be extended to 20 June 2015;
2 The date for compliance with order 4 of the October Orders be extended to 20 June 2015;
3 Given that:
(a) the mechanical kitchen exhaust fan system ("the Exhaust System") has been fully removed from the subject property since the October Orders;
(b) the absence of the Exhaust System from the subject property makes any proposed testing of the Exhaust System impracticable;
(c) any replacement of the of the Exhaust System will be required to comply with Development Conditions ANS06, ANS07, DA80 and DA223 in any event:
orders 5, 7, 8 of the October Orders be varied, set aside and/or vacated/varied to the extent not already complied with.
4. The Third Applicant forthwith reimburse to the Respondents all costs and expenses incurred by the Respondents in removing wiring from the exhaust shaft.
5. The applicants to pay the respondents' costs of this Notice of Motion.
A separate Notice of Motion seeking joinder of a third party Atcha Pty Ltd as a respondent was filed by the Applicant on 1 June 2015. Atcha Pty Ltd was joined by consent by Court order on 10 October 2015. Atcha Pty Ltd is the incoming purchaser of the restaurant.
[6]
Court orders 16 October 2015
Orders 1, 2, 2A, 4, 6 and 8 made by consent and matters 3, 5, 5A, and 7 noted on 16 October 2015 stated:
1. orders that the First, Second and Third Respondents carry out or cause to be carried out the works in the "Specification for new kitchen ventilation system for ground floor commercial tenancy No 2, 43-45 North Steyne, Manly, NSW ("the Premises") prepared by Richard Duggan Pty Ltd Spec No 2015/25, Rev B-2.7.2015 to the reasonable satisfaction of Richard Duggan of Richard Duggan Pty Ltd within 60 days of the date of these orders;
2. orders that conditional upon the Fourth Respondent (Atcha) becoming registered as proprietor of the Premises
(a) Atcha shall do all things reasonably necessary, and
(b) Upon reasonable notice from the First to Third Respondents, Atcha grant access to the First to Third Respondents their servants and agents to the premises;
for the purpose of the First to Third Respondents fulfilling their obligations under order 1 hereof;
2A orders that the Applicants shall cooperate fully to give effect to order 1;
3. notes that the First to Third Respondents do not press order 4 of their motion filed 14 August 2015 but the parties agree there is no bar or estoppel to the Respondents pursuing a claim in those terms in a Court of competent jurisdiction;
4. orders that orders 5(d), 7 and 8 made 30 October 2014 be vacated; from the date hereof;
5. notes that the Applicants do not and will not contend to the Respondents (including the Fourth Respondent) that other works required to be done pursuant to orders dated 12 March 2013 and 30 October 2014 by the Respondents have not been completed in a satisfactory manner;
5A notes that the Fourth respondent acknowledges that for the purposes of cl 45(d) the contract for sale between the First and Second Respondents as vendor and the Fourth Respondent as purchaser, save for in respect of the works the subject of Order 1, all works referred to in the orders of 12 March 2013 and 30 October 2014 and these orders are completed in accordance with the terms of those orders;
6. grants liberty to apply only in relation to an extension of the time in order 1;
7. notes the undertaking of the First to Third Respondents that they shall not conduct a restaurant at the premises;
8. otherwise dismisses the Applicants' motion dated 24 August 2015 and the First to Third Respondents motion dated 14 August 2015 other than in relation to the costs of the Applicants and First to Third Respondents.
On 20 November 2013 a Site Report prepared by CIS Combined Infrastructure Services Pty Ltd, "Post inspection rectification of Passive Fire works" and corresponding Passive Fire Protection Certificates was obtained so that order 5(a) of the later in time October 2014 Orders was complied with (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 5).
[7]
Chronology from 14 October 2014
The parties relied on numerous affidavits read in the proceedings as identified in pars 5 and 6 and referred to a number of annexures which contained the lengthy correspondence between the parties. A summary of this material in chronological order follows.
1. 14 October 2014 - independent experts' reports filed by the Applicants, prepared by Nathan Halstead (BCA certifier), Gary Graham (odour issues expert) and Roger Turvey (Affidavit of G Doyle 2 November 2015, Annexure C).
2. November 2014 - decision made by the Respondents to close the restaurant (Affidavit of S Anastasiou 22 May 2015, [17]).
3. 6 November 2014 - email from Mr Cunio (former solicitor for the Respondents) to Mr Webber enclosing a draft letter to Mr Halstead concerning all works that he should be involved in (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 1).
4. 7 November 2014 - email from Mr Webber to Mr Cunio concerning the draft letter to Mr Halstead (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 2).
5. 7 November 2014 - letter from Mr Cunio to Mr Halstead concerning works to be carried out (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 3).
6. 10 November 2014 - email from Mr Halstead to the solicitors for both parties advising of his inability to assist in the matter until December and making certain comments on the matters raised in the letter of 7 November 2014 (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 4).
7. 20 November 2014 - email chain between Mr Cunio, Mr Webber and Mr Turvey (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 8).
8. 20 November 2014 - email chain between Mr Wallace (First Applicant) and Mr Halstead regarding compliance of the wiring in the shaft (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 9).
9. 1 December 2014 - email from Mr Webber to Mr Cunio in relation to compliance with the October 2014 Orders, expressing the Applicants' concerns with respect to the lack of action on the orders (Affidavit of K Webber 30 April 2015, Annexure II).
10. 12 December 2014 - email from Mr Turvey to the solicitors for both parties attaching works diagrams (Affidavit of K Webber 30 April 2015, Annexure JJ).
11. 15 December 2014 - meeting with Mr Webber, Mr Cunio and Mr Turvey in order to review progress of the resolution of the kitchen ventilation system compliance and odour abatement issues (Affidavit of R Wallace 29 May 2015, Annexure A).
12. 16 December 2014 - email from Mr Graham to the solicitors for both parties advising of his inability to assist in the meantime due to unpaid invoices (Affidavit of K Webber 30 April 2015, Annexure KK).
13. 19 December 2014 - email from Mr Cunio to Remedial Building Services regarding contracting work recommended by Mr Halstead (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 11).
14. 22 December 2014 - email chain between Mr Cunio, Mr Webber and Mr Halstead regarding availability for attendance on site (Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 10).
15. 5 January 2015 - email from Mr Turvey to the solicitors for both parties attaching invoices (Affidavit of K Webber 30 April 2015, Annexure LL).
16. 6 January 2015 - email from Mr Graham to the solicitors for both parties advising of his inability to assist until outstanding invoices paid (Affidavit of K Webber 30 April 2015, Annexure MM).
17. 21 January 2015 - email from Mr Turvey to the solicitors for both parties requesting immediate payment of outstanding invoices (Affidavit of K Webber 30 April 2015, Annexure NN).
18. 2 February 2015 - email from Mr Turvey to the solicitors for both parties regarding future progress and unpaid invoices (Affidavit of K Webber 30 April 2015, Annexure OO).
19. 8 February 2015 - email from Mr Wallace to Mr Turvey (copied to the solicitors for both parties) regarding access to the building (Affidavit of K Webber 30 April 2015, Annexure PP).
20. 11 February 2015 - emails between Mr Cunio, Mr Wallace and Mr Turvey regarding access to the building (Affidavit of K Webber 30 April 2015, Annexure QQ).
21. 13 February 2015 - email from Mr Cunio to Mr Turvey and Mr Webber regarding access to the site for inspection (Affidavit of R Wallace 21 April 2015, Annexure AG).
22. 16 February 2015 - email from Mr Turvey to Mr Cunio, copied to Mr Webber regarding access to the site (Affidavit of R Wallace 21 April 2015, Annexure AI).
23. 17 February 2015 - emails between Mr Cunio, Mr Wallace, Mr Turvey and Mr Webber regarding access to the building for inspections and the closure of the restaurant (Affidavit of K Webber 30 April 2015, Annexure RR; Affidavit of S Anastasiou 22 May 2015, [21, 22], SAA1 (Ex 1) Tab 12; Affidavit of R Wallace 21 April 2015, Annexures AJ, AK).
24. 17 February 2015 - email from Mr Turvey to Mr Webber regarding the work to date and future work (Affidavit of K Webber 30 April 2015, Annexure SS; Affidavit of S Anastasiou 22 May 2015, SAA 1 (Ex 1) Tab 13).
25. 18 February 2015 - email from Mr Webber to Mr Cunio requesting a copy of the contract for sale of the Respondents' property and asking whether the sale will be on the basis of the consent for the restaurant having been surrendered (Affidavit of K Webber 30 April 2015, Annexure TT).
26. 10 March 2015 - email from the solicitors for the Applicants to Mr Doyle (new solicitor for the Respondents) informing him that they have been instructed to relist the matter and seek an expedited hearing for further orders given the lack of progress. Solicitors for the Respondents advised that they must either:
1. carry out the works;
2. provide sufficient funds to the firm's trust account to allow the Applicants to carry out the works; or
3. in the alternative, given that the Respondents are closing the restaurant and selling the property:
1. close the restaurant;
2. surrender the development consent granted in 2003;
3. surrender the current development consent;
4. remove kitchen fixtures and fittings including exhaust system and hoods and seal off the kitchen exhaust;
5. surrender the easement; and
6. pay the Applicants' costs as assessed or agreed from 12 March 2013 (Affidavit of K Webber 30 April 2015, Annexure UU).
1. 11 March 2015 - Notice of Motion filed by the Applicants.
2. 29 March 2015 - last day of trading for the restaurant (Affidavit of S Anastasiou 22 May 2015, [24]).
3. Week of 6 April 2015 - items removed from the restaurant including "1 x Exhaust fan and motor which decommissioned the exhaust system". Stainless steel hood and stainless steel benches the only items remaining in the kitchen of the restaurant (Affidavit of S Anastasiou 22 May 2015, [26]-29]).
4. 20 April 2015 - Notice of Motion filed by the Respondents.
5. 24 April 2015 - email from Mr Turvey to the solicitor for the Applicants advising of the formal termination of his contract, attaching an email from Mr Turvey to Mr Savva Anastasiou confirming payment of outstanding invoices after resort to the Building and Construction Industry Security of Payment Act 1999 (NSW) and consequent termination of contract on the basis of the Respondents' default (Affidavit of K Webber 30 April 2015, Annexure VV).
6. 4 May 2015 - contracts exchanged for the sale of the property (Lot 2 in SP 69948) (Affidavit of S Anastasiou 22 May 2015, [25]).
7. 21 May 2015 - First Respondent arranged for contractors to attend the site to ensure all outstanding work, except for any works associated with wiring to the exhaust shaft, had been completed or to confirm the length of time and when the work could be completed (Affidavit of S Anastasiou 22 May 2015, [34]).
8. 2 June 2015 - listed for hearing before Pain J. All Notices of Motion stood over and listed for mention 18 June 2015.
9. 2 June 2015 - the parties entered into an agreement with the intention of finalising the matter ("the 2 June 2015 Agreement") (Affidavit of R Wallace 10 September 2015, Annexure A).
10. 3 June 2015 - email from the solicitors for the Respondents to Mr Duggan (expert) inquiring into engagement of expert to design the kitchen exhaust ventilation system (in compliance with Term 1 of the 2 June 2015 Agreement) (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 6).
11. 4 June 2015- fee proposal sent by Mr Duggan to the solicitors for the Respondents (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 7).
12. 4 June 2015- correspondence from the solicitors for the Applicants to the solicitors for the Respondents agreeing to appoint Mr Duggan as the joint independent mechanical ventilation expert (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 8).
13. 5 June 2015 - letter from the solicitors for the Respondents to Mr Duggan concerning engagement to design the mechanical ventilation system, attaching copies of certain documents and reports (Affidavit of K Webber 14 September 2015, Annexure A).
14. 11 June 2015 - email from Mr Duggan to Mr Hatcher (sole director of Atcha Pty Ltd) Fourth Respondent regarding inspections and providing contact details (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 9).
15. 18 June 2015 - email from Mr Duggan to Mr Doyle regarding inspection of the site and identified deficiencies (Affidavit of K Webber 14 September 2015, Annexure B).
16. 18 June 2015 - listed for mention before Pain J. All Notices of Motion relisted for mention on 13 July 2015.
17. 20 June 2015 - invoice addressed to Atcha Pty Ltd from Richard Duggan Pty Ltd. (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 11).
18. By 20 June 2015 - the Respondents had complied with Orders 2, 3 and 4 of October 2014 Orders relating to grease trap/arrestor room and garbage room (Atcha and S Anastasiou dated 2 July 2015 and 22 May 2015)
19. 26 June 2015 - email from Mr Webber to Mr Halstead (Affidavit of K Webber 14 September 2015, Annexure C).
20. 30 June 2015 (on or around) - Mr Duggan forwarded the design and specification of the kitchen exhaust system to the solicitors for the Respondents and Mr Hatcher (Affidavit of G Doyle 6 October 2015, [12]).
21. 2 July 2015 - revised specification for new kitchen ventilation system prepared by Richard Duggan Pty Ltd forwarded to the solicitors for the Respondents and Mr Hatcher Fourth Respondent (Affidavit of R Wallace 10 September 2015, Annexure B; Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 12; Affidavit of K Webber 14 September 2015, Annexures E, F).
22. 2 July 2015 - email from the solicitor for the Respondents to the solicitors for the Applicants discussing the meeting between the parties required as per the 2 June 2015 Agreement (Affidavit of K Webber 14 September 2015, Annexure D). The Applicants' solicitors did not reply to this email (Affidavit of G Doyle 6 October 2015, [3]).
23. 9 July 2015 - email from the solicitor for the Respondents to the solicitors for the Applicants following up on the 2 July email regarding a date for the required meeting (Affidavit of G Doyle 6 October 2015, Annexure B).
24. 9 July 2015 - phone conversation between Mr Doyle and Mr Webber with Mr Webber stating that the Applicants were reviewing the Duggan report and may have some issue or questions.
25. 13 July 2015 - listed for mention before Pain J. All Notices of Motion relisted for mention 3 August 2015.
26. 13 July 2015 - email from Mr Doyle to Mr Webber regarding questions and comments on Mr Duggan's proposed design (Affidavit of K Webber 14 September 2015, Annexure G).
27. 14 July 2015 - email from the Respondents' solicitors to the Applicants' solicitors regarding the questions the Applicants may have of Mr Duggan (Affidavit of K Webber 14 September 2015, Annexure H).
28. 24 July 2015 - document containing the Applicants' issues or questions regarding the Duggan report received by the solicitors for the Respondents (Affidavit of K Webber 14 September 2015, Annexure J).
29. 28 July 2015 - email from Mr Duggan in reply to the Respondents' solicitors' email containing the Applicants' issues or questions regarding the Duggan report. Mr Duggan advised that he would not be commenting on the letter until his outstanding invoice had been paid (Affidavit of K Webber 14 September 2015, Annexure K).
30. 3 August 2015 - listed for mention before Pain J. Leave to obtain hearing date for the Notices of Motion filed 11 March 2015 and 20 April 2015.
31. 4 August 2015 - listed for mention before Registrar. Hearing of the Notices of Motion filed 11 March 2015 and 20 April 2015 set down for 6-7 October 2015.
32. 14 August 2015 - Respondents' Amended Notice of Motion filed.
33. 24 August 2015 - Applicants' Amended Notice of Motion filed.
34. 25 August 2015 - listed for mention before Pain J. Orders made to vacate the hearing date of 6 October 2015 and confirm the hearing date of 7 October 2015.
35. 30 September 2015 - correspondence from the Applicants' solicitor to the Respondents' solicitor regarding the hearing of the motion on 7 October (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 13), advising that:
1. the Respondents' motion should proceed first as they seek to be relieved of the obligation to comply with the previous orders;
2. the relief sought by the Respondents is beyond the power of the Court as they are beyond the scope of liberty to apply and of "working out the orders";
3. the only substantial order to be pressed by the Applicants is order 8 of the Applicants' motion, but only if the Court makes the order sought by the Respondents;
4. the Respondents' claim in motion order 4 is beyond the jurisdiction of the Court; and
5. the Applicants seek costs of the motions now being determined, with the claim for costs to be adjourned until after the determination of the current motions.
1. 6 October 2015 - correspondence in reply from Respondents' solicitor (Affidavit of G Doyle 6 October 2015, Exhibit GGD-1, Tab 14), advising:
1. the motions are inextricably linked and should be heard together;
2. orders 8(a) and 8(b) are not necessary as the Respondents have not been operating the restaurant since 29 March 2015 and have exchanged contracts for sale of the lot;
3. order 8(c) is beyond the power of the Court; and
4. there is no reason for adjournment of the costs argument, and requesting the Applicants to advise the grounds on which the cost argument should be adjourned.
1. 7 October 2015 - listed for hearing before Pain J. Matter part heard, stood over for directions hearing on 16 October 2015.
2. 14 October 2015 - Notice of Motion joining Atcha Pty Ltd listed for mention before Pain J. Atcha Pty Ltd joined as a respondent by consent.
3. 15 October 2015 2:17pm - email sent from the solicitors for the Respondents to the solicitors for the Applicants containing a letter offering to settle the proceedings, to which no response was received (Affidavit of G Doyle 2 November 2015, Annexure A).
4. 15 October 2015 2:18pm - email sent from the solicitors for the Respondents to Mr Howard (solicitor for the Fourth Respondent) containing a letter offering to settle the proceedings, to which no response was received (Affidavit of G Doyle 2 November 2015, Annexure B).
5. 16 October 2015 - listed before Pain J for continuation of hearing. Consent orders made before finalisation of hearing.
[8]
Applicants' submissions
The Respondents capitulated in the March 2013 Orders which included an order that the Respondents were to undertake the work specified in the orders and to pay the Applicants' costs of the proceedings as agreed or assessed. The Respondents should now pay the Applicants' costs of working out the March 2013 Orders which was the purpose of the October 2014 Orders. The substance of the October 2014 Orders was to address work not carried out, work which had been carried out other than in a workmanlike manner and the need to retain an additional expert. The October 2014 Orders were supplementary to and not a substitute for the March 2013 Orders. The Respondents capitulated in agreeing to the making of the October 2014 Orders. The same cost consequences as the March 2013 Orders should follow so that the Respondents pay those costs of the Applicants.
The October 2015 Orders do not relieve the Respondents of the obligation to install an effective ventilation system and also note the undertaking of the Respondents not to conduct a restaurant at the premises. The orders require the Respondents to do what the Applicants seek which is the installation of an effective ventilation system. The Applicants' Notice of Motion dated 11 March 2015 and Amended Notice of Motion dated 24 August 2015 sought in substance to work out the March 2013 Orders and the October 2014 Orders. The substance of the October 2015 Orders is consistent with the remedy sought by the Applicants in their Notice of Motion and also represents a capitulation by the Respondents.
It should not be forgotten that much of the recent forensic activity has been brought about by the Respondents' decision to close the restaurant and to sell the premises a decision made in or around November 2014 [Affidavit of Steve Anastasiou sworn 22 May 2015 at [17] and [25]] but not communicated to the Applicants' representatives until 17 February 2015 [Affidavit of Kendall Webber sworn 30 April 2015 at [48] and Affidavit of Richard Wallace sworn 21 April 2015 at [52]]. It is fundamentally the actions and inactions of the Respondents which have brought about the need to bring the matter back before the Court, both to ensure that the ventilation work was done and to identify the scope of that work. That is evident from the orders made. The conduct of the Respondents has brought the parties to court in 2015 in order to work out compliance with the March 2013 and October 2014 Orders.
There is no disentitling conduct on the Applicants' part which would prevent a costs order being made in their favour.
[9]
Respondents' submissions
The Respondents did not capitulate in agreeing to the March 2013 Orders. Not all the orders sought by the Applicants' summons were made. Indeed the substance of the orders was not made. That a costs order was made in the Applicants' favour on that occasion does not mean the Respondents capitulated. The circumstances surrounding that order are unknown. That the October 2014 Orders were a working out of the March 2013 Orders does not mean the Respondents should pay costs as there was no capitulation. In any event costs should not follow automatically as that would fetter the discretion of the Court.
Changed circumstances since the making of final orders can necessitate the further working out of final orders as occurred in this case. The First and Second Respondents sold the restaurant and partly removed the ventilation system in issue.
The Applicant should pay the Respondents' costs of the 2015 Notices of Motion as the Applicant acted so unreasonably that such a costs order is justified per Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex part Lai Qin [1997] HCA 6; (1997) 186 CLR 622 ("Lai Qin") at [624]. Additionally, some of the relief sought such as the surrender of the development consents was doomed to fail and such an order would have had significant consequences for the Respondent if made.
[10]
Applicants' costs payable in part by First to Third Respondents
The Court has a broad discretion to determine costs under s 98 of the Civil Procedure Act 2005 (NSW). Costs are compensatory not punitive, per Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534. The usual costs order in civil enforcement proceedings is that costs follow the event per Uniform Civil Procedure Rules 2005 (NSW) r 42.1. As there was no finalisation of the contested hearing before the Court, with consent orders made in 16 October 2015 after a partial hearing on 7 October 2015, there is no event which informs the determination of costs. Circumstances surrounding the making of consent orders can inform the Court's determination of whether to make an order for costs and in what terms. The allocation of costs in the absence of a merit determination by a court was helpfully considered in Kiama Council v Grant [2006] NSWLEC 96; (2006) 143 LGERA 441 ("Kiama") at [80], Preston CJ stating after a review of numerous cases:
The principles that emerge from these cases are that in a civil enforcement or judicial review case where there has been no hearing on the merits:
(a) where one party effectively surrenders to the other party by:
(i) discontinuing without the consent of the other party; or
(ii) giving undertakings to the Court or submitting to the Court making orders against the party substantially in the terms or to the effect claimed by the other party;
the proper exercise of the costs discretion will ordinarily be to make the usual order as to costs, unless there is disentitling conduct on the part of the other party; and
(b) where some supervening event or settlement so removes or modifies the subject of the dispute that no issue remains except that of costs, the proper exercise of the costs discretion will ordinarily be to make no order as to costs unless:
(i) one of the parties has acted so unreasonably that the other party should obtain the costs of the action; or
(ii) even if both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried so that the party should obtain the costs of the action.
The Applicants essentially rely on the circumstances referred to in par 80(a)(ii) to argue all their costs should be paid. The Respondents rely on par 80(b)(i) to argue the Applicants should pay their costs. Alternatively the Respondents rely on par 80(b) to argue each of the parties should pay their own costs.
The October 2014 Orders can be considered separately from the 2015 Notices of Motion. The October 2014 Orders set out in par 10 required work by the First, Second and Third Respondents to be carried out in four areas, the greasetrap/arrestor room, garbage room and fire rated shaft in accordance with the report of Mr Halstead of November 2013 and the kitchen ventilation system in accordance with the report of Mr Turvey. The October 2014 Orders expressly supplement the March 2013 Orders which also required substantial work by the Respondents in obtaining expert reports and carrying out work recommended in those reports. The March 2013 Orders also required specific building work to be done by the Respondents in cl 2 of the schedule, summarised above in par 9(1). The October 2014 Orders have the effect claimed by the Applicants, namely orders substantially in the terms claimed by another party, a circumstance identified in Kiama at par 80(a)(ii). As the Applicant submitted, if the expert reports had found that no work was required then the issues would have been settled and there would have been no need for further orders. While not all the relief sought by the Applicants in the summons was obtained such as declarations of breaches of development consent conditions (which cannot be obtained from the Court by consent in any event) a substantial part of the specific work identified in prayer 3 was the subject of the March 2013 Orders and also subsequently the October 2014 Orders. The Respondents should pay the Applicants' costs of the October 2014 Orders.
There was a material change in circumstance after the October 2014 Orders from the Respondents' point of view with the sale of the restaurant, the business ceasing to trade in March 2015 and the removal of the kitchen exhaust fan, a part of the ventilation system, in April 2015. The parties filed competing Notices of Motion in March and April 2015. These sought extensive orders as can be seen from their terms set out above in pars 11 and 13. Both motions were substantially amended in August 2015 as set out above in pars 12 and 14.
Correspondence referred to in the chronology in par 19 commencing in October 2014 demonstrates that there was extensive discussion and negotiation in relation to the implementation of the work required by the March 2013 and October 2014 Orders between all parties. The correspondence identified in the parties' affidavits is between the respective solicitors and expert consultants such as Mr Halstead, Mr Turvey and Mr Graham from November 2014 to February 2015 concerning the scope of work to be undertaken (par 10(3)-(26). Some of the correspondence summarised in par 19(13) and (16)-(19) concerns requests for payment of invoices by consultants which was the responsibility of the First, Second and Third Respondents. Mr Turvey was eventually paid by 24 April 2015 (par 19(32)). Ultimately Mr Graham and Mr Turvey did not continue to advise. By March 2015 the Applicants considered that it was necessary to return the matter to court as work had not occurred and wrote to that effect on 10 March 2015. The Applicants' Notice of Motion was dated 11 March 2015.
The Applicants reasonably filed the Notice of Motion dated 11 March 2015 as much of the work required by the March 2013 and October 2014 Orders was then undone. The October 2014 Orders required that work be done within either 28 or 60 days from the date of the order so that all work should have been completed by the end of 2014. The first order sought in the Applicants' Notice of Motion was that the schedule to the March 2013 Orders be complied with. There was extensive discussion over several months between the parties and experts in relation to the ventilation system with a change of expert from Mr Turvey to Mr Duggan. Mr Duggan was engaged by the Respondents on or about 3 June 2015 (the day after the first hearing day was adjourned) and undertook design work which was sent to all the parties in July 2015, par 19(39)-(50), (52)-(55). The delay in the Respondents carrying out the earlier consent orders in relation to the kitchen ventilation system appeared to be partly due to non-payment of Mr Turvey who terminated his commission in April 2015.
The Applicants' Amended Notice of Motion dated 24 August 2015 sought orders requiring work to be done in relation to orders 2, 3, 4 and 5 of the October 2014 Orders. Much of this work had been done by the end of June 2015 according to the affidavits of Mr Anastasiou which were not disputed at the hearing on 7 October 2015. The affidavits of Mr Anastasiou dated 22 May 2015 and 2 July 2015 identify that the work required for the grease trap/arrestor room and garbage room as required by Mr Halstead's report was carried out during April to June 2015 or was in fact completed in November 2013 in relation to the fire rated shaft by contractors for the Respondents. This work was the subject of orders 2, 3, 4 and 5(a)-(c) of the October 2014 Orders.
As can be seen from the number of mentions and hearing days before me from mid-2015 (2 June 2015 (hearing adjourned on advice that parties intended to reach agreement), 18 July 2015, 13 July 2015, 3 August 2015, 4 August 2015, 25 August 2015, 7 October 2015 (part heard), 14 October 2015 (Fourth Respondent joined by consent) and 16 October 2015 (consent orders made)) the negotiations between the parties were protracted and not always successful given that at least one hearing day occurred. At the hearing on 7 October 2015 the Applicant accepted that all required work had been done in relation to the grease trap/arrestor room, garbage room and fire rated shaft, as its solicitor advised the Court on that day (TS 7.10.15 p 1 ln 1). Apparently this is the first time that was communicated to the Respondents (TS 7.10.15 p 6 ln 17). The main outstanding issues at that time were in relation to the kitchen ventilation system namely orders 5(d), 6, 7 and 8 of the October 2014 Orders. After one day of hearing on 7 October 2015 directed to the Court's power to work out final consent orders the parties agreed further consent orders on 16 October 2015, the second hearing day. Those orders set out above in par 17 required work to be done by the Respondents on the kitchen ventilation system in accordance with an expert report of Mr Duggan and vacated three of the October 2014. Matters noted by the Court were that the Applicants no longer contended that any work from the March 2013 and October 2014 Orders was outstanding and that the First to Third Respondents undertook not to conduct a restaurant at the premises.
Neither party in agreeing to the October 2015 Orders and noted matters was successful in obtaining all the relief sought in either their original or amended Notices of Motion. For example the Applicant did not obtain alternative orders in accordance with its original Notice of Motion and Amended Notice of Motion that the Respondents not carry on the business of a restaurant, remove all fixtures and fittings and surrender two development consents. Decisions made by the First to Third Respondents in November 2014 meant that the restaurant was not to be continued by them in any event. It is unlikely in my view that the Court would have power to order the Respondents to surrender their development consents and I note that such an order would have major consequences for the Respondents not least because there would then have been no restaurant business to sell.
The Respondents' original Notice of Motion dated 20 April 2015 sought variations of the time for compliance with orders 2, 3, 4 and part of 5 in the October 2014 Orders in prayers 1, 2 and 3, and vacation of orders related to the ventilation system in prayer 4 as they had caused the removal of the kitchen exhaust fan after October 2014. The original Notice of Motion orders sought to put in place a regime different to that agreed in the earlier March 2013 and October 2014 Orders. They proposed the appointment of their own mechanical ventilation expert to prepare a report and do whatever work was recommended. The Applicants were to appoint their own expert to comment on the Respondents' expert report with the two experts to conclave about the preferred scope of works which the Respondents would carry out. The Amended Notice of Motion filed 14 August 2015 was shorter and sought orders vacating some of the October 2014 Orders with the effect that no further work would be carried out on the kitchen ventilation system as the exhaust fan had been removed. The Respondents did not obtain such an order. While I heard argument on 7 October 2015 about whether the Court had power to make the orders sought by the Respondent as further working out of final consent orders I did not need to rule on that issue as the parties agreed on the October 2015 Orders and the hearing did not need to be finalised.
Consent order 1 of the October 2015 Orders concerned the only major part of the earlier March 2013 and October 2014 Orders still undone by that time. The order was in line with the Respondents' proposals to the Applicants in the letter sent to the Applicants' solicitors from the Respondents' solicitors on 15 October 2015, the day before the adjourned hearing. The orders are in accordance with at least part of the orders sought by the Applicants in the original Notice of Motion dated 11 March 2015.
That the Respondents chose to sell the restaurant which decision took a number of months to effect and remove the kitchen exhaust fan in April 2015 did not automatically remove their responsibility to comply with the March 2013 and October 2014 Orders which were binding on them. The practical outcome of joining Atcha Pty Ltd as a party does not overcome that obligation. The sale is not an intervening event for the purposes of costs in my view. As already identified above in par 32 the Applicant had reasonable cause to pursue the Respondents to comply with the March 2013 and October 2014 Orders.
The protracted negotiations between the parties demonstrate that reaching a final resolution was challenging. Ideally the matter would have been resolved faster and with less argument and expense but ultimately agreement was reached over many months that the First to Third Respondents must do more work in relation to the kitchen ventilation system (or alternatively the Fourth Respondent about whom I need say no more in this context). These circumstances have some similarity to those described in Kiama at par 80(a)(ii). Order 1 made on 16 October 2015 was substantially in the terms or to the effect claimed in part by the Applicant. The Applicants were not successful in relation to a large part of the relief sought in the original and Amended Notices of Motion, delayed in accepting that work to implement orders 2, 3, 4 and part of 5 of the October 2014 Orders had been done and some of the relief sought by them was unreasonable. They should not have all their costs in these circumstances. It is appropriate that half their costs of the Notice of Motion dated 11 March 2015 and the Amended Notice of Motion dated 24 August 2015 be paid by the First, Second and Third Respondents.
The Applicants did not behave so unreasonably that some or all of the Respondents' costs of its Notice of Motion and Amended Notice of Motion ought be paid by them. Nor is there any basis for ordering that the Respondents' costs be paid given that the principal relief sought by them concerning the kitchen ventilation system was not the subject of any order.
The Respondents sought costs on an indemnity basis for a limited period commencing at 5pm on 15 October 2015. The relevant correspondence is identified in the chronology above at par 19(64)-(66). There is no basis for awarding indemnity costs in the circumstances relied on. As the Applicant submitted the offer was made at about 2pm on 15 October 2015 the day before the adjourned hearing on 16 October 2015 with an answer sought by 5pm. That timetable is quite unreasonable and can provide no basis to award costs on an indemnity basis.
[11]
Orders
The Court makes the following orders:
1. The First, Second and Third Respondents are to pay the Applicants' costs of the Orders of 30 October 2014.
2. The First, Second and Third Respondents are to pay half of the Applicants' costs of the Notice of Motion dated 11 March 2015 and the Amended Notice of Motion dated 24 August 2015.
3. The exhibits are to be returned.
[12]
Amendments
01 February 2017 - Missing hearing dates added - cover page
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: 01 February 2017