Solicitors:
N/A (Applicants)
Hanna Lawyers (Respondents)
File Number(s): 2023/00333334-003, 004
[2]
Ex Tempore JUDGMENT
The parties are neighbours in Helensburgh. The Applicants commenced proceedings under the Trees (Disputes Between Neighbours) Act 2006 (NSW) (Trees Act). An application under the Dividing Fences Act 1991 (NSW) (DF Act) commenced in Wollongong Local Court by the Respondents was also joined in the proceedings. In Wang v Geyer [2024] NSWLEC 1257 (Wang No 1) Acting Commissioner Douglas (the AC) made various orders in relation to the management of trees along the shared boundary and ordered the parties share the cost of building a colourbond boundary fence inter alia. Both parties have filed a notice of motion seeking that their costs and disbursements be paid by the other party and the Applicants seek the costs of their notice of motion. The parties clarified in the hearing that they did not seek indemnity costs. Ms Wang the First Applicant represented herself and acted as agent for her husband Mr Khaw the Second Applicant. The Respondents were legally represented. The Class 2 application was filed on 20 October 2023, the hearing was on 31 January 2024.
Relevant provisions of the Trees Act state as follows:
Part 2 Court orders - trees that cause or are likely to cause damage or injury
7 Application to Court by affected land owner
An owner of land may apply to the Court for an order to remedy, restrain or prevent damage to property on the land, or to prevent injury to any person, as a consequence of a tree to which this Act applies that is situated on adjoining land.
…
10 Matters of which Court must be satisfied before making an order
(1) The Court must not make an order under this Part unless it is satisfied:
(a) that the applicant has made a reasonable effort to reach agreement with the owner of the land on which the tree is situated, and
(b) if the requirement to give notice has not been waived, that the applicant has given notice of the application in accordance with section 8.
(2) The Court must not make an order under this Part unless it is satisfied that the tree concerned:
(a) has caused, is causing, or is likely in the near future to cause, damage to the applicant's property, or
(b) is likely to cause injury to any person.
…
Matters to be considered by the Court in considering whether an order ought be made are set out in s 12.
Section 9 of the DF Act provides for contribution being required from a neighbour when urgent fencing work is necessary. Under s 13A the Court has jurisdiction to determine matters under the DF Act where an application has been made under s 7 of the Trees Act. The Court can transfer a matter from the Local Court on its own motion or on a party's application, s 13A(3). Section 7 provides that adjoining owners are liable to contribute in equal proportions to the carrying out of fencing work in respect of a dividing fence of a standard not greater than the standard for a sufficient fence.
Wang No 1 is a lengthy judgment of 133 paragraphs. Extensive orders were sought by the Applicants as set out at [18]. Alternative orders proposed by the Respondents were set out at [18]. The AC made 14 orders responding to the various issues identified. The arborists' evidence was considered at [19]-[26]. Jurisdictional requirements in Part 2 of the Trees Act were considered at [34]-[42] in relation to s 10(1)(a) of the Trees Act and found to be satisfied. Damage to trees now or in the near future, referred to in s 10(2), was considered at [45]-[51] arising from tree 4 (oleander), tree 1, tree 9 and tree 14 (identified by the Respondents' arborist Mr Coulter) and tree 2 identified by the Applicants' arborist, and a dead tree identified by the AC. Whether the oleander tree was toxic to humans was considered, with the risk of poisoning from the oleander tree found to be extremely low so that the Applicants' argument was not accepted, at [52]-[53]. In relation to electricity services and tree trimming considered at [54]-[56], no risk of injury to persons was established by the Applicants. Consideration of discretionary matters in s 12 of the Trees Act was undertaken at [57]-[63]. The boundary fence deterioration was considered at [64]-[91], the AC concluding that both parties' actions or omissions contributed to the fence's decline and the impact of each parties' contributions roughly balanced out. No additional compensation was held to be payable to the Applicants as they had sought, and the costs of constructing a boundary fence if ordered would be shared. Whether urgent fencing work was necessary as the Applicants submitted in reliance on s 9 of the DF Act was considered at [92]-[113] with the conclusion at [114] that no compensation for the wire mesh fence installed by the Applicants was payable and s 9 of the DF Act was found not to apply. Applying s 13(2) of the DF Act the existing mesh fence was found not 'sufficient', contrary to the Applicants' case. A new colourbond boundary fence was ordered with the cost to be shared, at [124]. The Respondents were ordered to repair boundary posts which had been damaged by tree 18. Orders for dealing with utility services, if located relevant to the boundary fence, were made.
Costs in Class 2 proceedings are to be considered under Pt 3 r 3.7 of the Land and Environment Court Rules 2007 (NSW) (LEC Rules) as provided for in s 98 of the Civil Procedure Act 2005 (NSW). Rule 3.7 of the LEC Rules applies to all proceedings in Class 2 of the Court's jurisdiction. The Court is not to make an order for the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs sought is fair and reasonable in the circumstances under subr (2). Under subr (3):
Circumstances in which the Court might consider the making of a costs order to be fair and reasonable include (without limitation) the following:
(a) that the proceedings involve, as a central issue, a question of law, a question of fact or a question of mixed fact and law, and the determination of such question:
(i) in one way was, or was potentially, determinative of the proceedings, and
(ii) was preliminary to, or otherwise has not involved, an evaluation of the merits of any application the subject of the proceedings,
…
(c) that a party has acted unreasonably in circumstances leading up to the commencement of the proceedings,
(d) that a party has acted unreasonably in the conduct of the proceedings,
(e) that a party has commenced or defended the proceedings for an improper purpose,
(f) that a party has commenced or continued a claim in the proceedings, or maintained a defence to the proceedings, where:
(i) the claim or defence (as appropriate) did not have reasonable prospects of success, or
(ii) to commence or continue the claim, or to maintain the defence, was otherwise unreasonable.
Rule 3.7(2) of the LEC Rules reflects the presumptive rule based on the no discouragement principle that a person should not be discouraged from making or defending an application because of the risk of an adverse costs order, Arden Anglican School v Hornsby Shire Council (2008) 158 LGERA 224; [2008] NSWLEC 103 at [10] cited in Popovac v Kennedy [2022] NSWLEC 9 (Popovac) at [31]. The Court has discretion to decide if costs ought be payable. Circumstances where a costs order may be made are identified in subr (3) of r 3.7. The circumstances identified in subr (3) are not exhaustive. The usual rule that each party pays their own costs is informed by the nature of these proceedings, see Smith v Kaddour (No 2) [2018] NSWLEC 21 at [25].
In Marks v Perham (No 2) [2020] NSWLEC 84 at [29]-[30] cited in Popovac at [32] Robson J helpfully stated:
29 The no discouragement principle is particularly important in the context of applications made pursuant to the Trees Act, as such applications are subject to the Court's Practice Note Class 2 - Tree Applications which is designed to facilitate the just, quick and cheap resolution of tree disputes through an appropriate and easily accessible procedure.
30 In approaching the task before me, I consider that it is appropriate, first, to identify whether there is anything within the judgment of the Commissioner which indicates that an order for costs may be fair and reasonable; and second, to look to the conduct of the parties both before and during the hearing for any indication that such an order may be appropriate.
The evidence read on each notice of motion was considered in relation to both notices of motion. The affidavit of Ms Wang dated 6 June 2024 was read in part, including several paragraphs identifying correspondence between the parties' solicitors after the Class 2 application had been filed up to the hearing date. This overlapped with correspondence for the same period annexed to the affidavit of Mr Hanna solicitor dated 13 June 2024 which was also read in part.
As I ruled during the hearing on costs that correspondence between the parties leading up to the filing of the Class 2 application is irrelevant that need not be set out. The parties agreed the following correspondence contained their attempts at settlement negotiations after the Class 2 application was filed leading up to the hearing on 31 January 2024, as referred to in their respective affidavits and summarised in the following table (marked MFI 1).
Date Event
16- 22 November 2023 Applicants initiated settlement negotiation.
Respondents sent a first response demanding a different fencing proposal to that sought under the fencing notice, and refused to remove any tree.
Applicants requested to transfer Respondents' fencing application into the Court at direction hearing. Applicants filed a notice of motion to transfer.
20-27 November 2023 Respondents opposed the transfer order before and during direction hearing.
(Facts in dispute on the reason why order was not granted)
20 December 2023 Respondents sent a settlement offer.
20 December 2023 -17 January 2024 Applicants raised questions about the offer and received no reply.
23 December 2023 - 14 January 2024 Both Applicants' and Respondents' solicitors' offices closed for the holiday period.
22 January 2024 Respondents filed affidavits and expert report dated 2 November 2023. Respondents sent proposed orders to Applicants.
29 January 2024 Applicants sent a settlement offer to Respondents.
30 January 2024 Respondents sent a counter offer.
[3]
Rule 3.7(3)(c)
In the course of the hearing I would not permit either party to make submissions or rely on evidence seeking to establish that one of them unreasonably failed to settle the matter before proceedings were commenced, circumstances they sought to make relevant under r 3.7(3)(c). The AC made an express finding at [42] as follows:
42 Regardless that they are currently in deep dispute, the parties have communicated and negotiated about the trees and fence for over two years. Based on the history informing the dispute and other adduced evidence, both parties have invested considerable sustained efforts towards reaching agreement, more than is necessarily required. Consequently, I am satisfied the applicants have made a reasonable effort to reach agreement with the owners of the land on which the trees are situated, such that s 10(1)(a) of the Act is engaged.
That finding in relation to s 10(1)(a) of the Trees Act means that it is not appropriate in this costs matter that the parties seek to re-litigate matters that the AC had regard to in coming to the view that there had been reasonable settlement efforts. No basis exists in Wang No 1 for considering r 3.7(3)(c) of the LEC Rules in the context of settlement negotiations between the parties before proceedings commenced.
[4]
Rule 3.7(3)(d), (f)(i)
Both the Applicants and Respondents alleged unreasonable behaviour by the others during the proceedings (relying on r 3.7(3)(d)) as the parties continued to seek to settle the matter after proceedings were commenced with numerous written offers made between the parties' solicitors, as set out above in [11]. Both parties submitted each other's behaviour was unreasonable in not settling in this period as according to each of them the final orders made by the AC were in similar terms or better than offers made in this period.
Ms Wang submitted that the offers made were in similar terms to the AC's orders and the Respondents were unreasonable in not accepting the settlement offers made. The Respondents made the same submission reflecting partially their assessment of what was offered and what the AC ordered. The focus of arguments was a detailed settlement offer dated 29 January 2024 from the Applicants and a detailed counter offer on 30 January 2024 being an offer made just before the hearing on 31 January 2024.
Ms Wang also alleged based on essentially the same arguments made in relation to settlement negotiations that the Respondents lacked reasonable prospects of success relying on subr 3(f)(i).
[5]
Finding on r 3.7(3)(d),(f)(i)
I have read Wang No 1 as a whole including comparing the lengthy orders made by the AC compared to the orders sought by the parties, and having read the numerous settlement offers made in the period 16 November 2023 to 30 January 2024 set out in the table above, I can conclude that there was no clear winner or loser in the orders made by the AC. The parties had identified a number of issues between them in relation to which of the Respondents' trees should be removed or trimmed, and what kind of fence if any should be installed on the boundary and what should be done about any services that might by in the way of a boundary fence.
Submissions were made that the Respondents unreasonably refused a boundary survey, but this was agreed to by them in the correspondence with costs to be shared suggesting this became a non-issue. Various examples according to the Applicants of non-compliant proposals for boundary fencing of certain heights and using pine sleepers were referred to. These were the subject of the ongoing negotiation between the parties. The Applicants' submissions that the Respondents failed to understand their responsibility to trim their trees in relation to powerlines is addressed in Wang No 1 at [56] and no basis exists for such a submission. I do not accept the Applicants' submissions that the Respondents failed in every material aspect of their DF Act application, indeed I consider they were largely successful.
It is unnecessary to canvas in full the extremely detailed submissions of the Applicants in particular about what were submitted to be reasonable offers on their part which the Respondents should have accepted in their view given I have reviewed the material relied on by the parties. As already held neither party was entirely successful in the matters they pursued before the AC. The last settlement letter sent by the Respondents' solicitor the day before the hearing dated 30 January 2024 offered to settle in reasonably similar terms to the AC's final orders. I also accept the Applicants' submission that that letter of offer did not adequately deal with underground utility services and how tree trimming costs ought be shared. In essentially the same way that the AC found the parties had engaged in reasonable settlement efforts over two years at [42], there is no basis to support a finding of unreasonable behaviour in relation to the conduct of any of the parties such as to warrant a costs order pursuant to r 3.7(3)(d) as a result of their very detailed but ultimately unsuccessful settlement negotiations in the period being considered. No party succeeds on this basis.
This finding also essentially deals with the Applicants' submission that the Respondents maintained the proceedings without reasonable prospects of success (subr (f)(i)). There is simply no basis in Wang No 1 to support that submission. The Respondents were successful in having some of the orders sought by the Applicants not made at all or varied. The Applicants were unsuccessful in several matters identified above in the summary of Wang No 1. The Applicants' position that the existing fence was sufficient under the DF Act was not accepted and the parties were ordered to build a new boundary fence, with the cost to be shared, as is usual for boundary fences and provided for in the DF Act. The Respondents had offered this outcome in the lead up to the hearing. I do not accept the Respondents' defence (noting that response is a more appropriate term in a Trees Act matter) lacked reasonable prospects of success and the Applicants are unsuccessful on this basis.
[6]
Rule 3.7(3)(e) improper purpose not established
The Applicants alleged the Respondents defended the proceeding for an improper purpose. The Applicants' assertions that the Respondents were pursuing an illegal fencing proposal, which seemed to underpin several arguments I had difficulty understanding, did not arise from any matter identified in the AC's judgment. The submission related to a proposal for pine sleepers to be used under the boundary fence, which was said to not comply with a relevant state environmental planning policy. I do not need to resolve that question in order to resolve whether costs ought be payable. The AC made an order that the new boundary fence must have no aboveground components made of combustible material and referred to not using pine sleepers. It was not a matter that the AC dealt with substantively and is not self-evidently a basis for submitting unlawfulness in relation to the entire proceedings or that the Respondent defended the proceedings for an improper purpose, a serious allegation (subr (3)(e)). No factual or legal basis exists for such a broad submission to be made. The Applicants are not successful on this basis.
[7]
Rule 3.7(3)(a)
Both parties made different submissions to that effect that there were questions of fact or mixed fact and law which were determinative of the proceedings such that their costs ought be paid.
The Respondents referred to the compensation being sought by the Applicants of $4,992.50 for the installation of a wire mesh fence. At issue was whether these were 'spot repairs' or 'urgent fencing work' under the DF Act, the AC finding they were not. The Applicant also sought an order for repair of the existing mesh fence and this was also not accepted in Wang No 1. Given the range of issues before the AC, these issues while relevant to his ultimate decision are not so obviously dominant in the outcome of the proceeding that a costs order is warranted on this basis in the Respondents' favour.
The matters identified by the Applicants were that the Applicants' Trees Act application was found to have satisfied the notice requirements in s 8(1) of the Trees Act at Wang No 1 at [28]-[32], despite the Respondents' argument to the contrary, one of many matters the AC considered. Another matter identified by the Applicants termed 'repair of an existing hardwood fence' did not appear to arise from any issue identified in Wang No 1. In any event these submissions largely related to issues that were part of the merits review by the AC.
Neither party has established a basis to award costs under r 3.7(3)(a) in relation to a determinative issue.
[8]
Costs of transfer of Local Court proceeding not payable to Applicants
The Applicants also sought their costs of the notice of motion filed in the Court seeking transfer of the Local Court proceeding commenced by the Respondents in reliance on the DF Act to the Court. I infer the Applicants considered that the Respondents acted unreasonably in commencing the Local Court proceeding necessitating transfer to the Court.
The relevant circumstances are as follows:
DATE EVENT
20 October 2023 Trees Act application commenced by the Applicants.
9 November 2023 Local Court proceeding (DF Act application) commenced by the Respondents.
21 Nov 2023 Directions made by Registrar:
Direction 1A - an order under the DF Act transferring the Local Court proceeding to the Court was not made.
22 Nov 2023 Applicants filed the notice of motion dated 22 November 2023 seeking an order that the Local Court proceeding be transferred to the Court.
The Registrar ordered as follows:
30 Nov 2023 1. The notice of motion filed 22 November 2023 is granted by consent.
2. Under Section 13A(3) of the DF Act, order to transfer Local Court proceeding to the Court, with evidence and orders in one proceeding being evidence in all.
3. Costs of the notice of motion are reserved.
[9]
The Applicants submitted that they had to have the Local Court proceeding transferred to the Court in order for the DF Act matters to be considered. The Respondents submitted that was not necessary as the Court had jurisdiction in any event. The Registrar did not make an order for transfer of the proceeding on 21 November 2023 for that reason. The Applicant's notice of motion dated 22 November 2023 was unnecessary.
I do not have the benefit of the transcript of the proceeding before the Registrar on 21 November 2023 so that the parties' arguments are not precisely known and the Registrar's reasons not before the Court now. Firstly, the Court has jurisdiction in relation to DF Act matters under s 13A(1) when dealing with matters under s 7 of the Trees Act, see s 13(2) of the DF Act. The DF Act has provision for the transfer of proceedings in s 13A(3) which states that the Court may (my emphasis) on its own motion or on a party's application transfer proceedings. These sections suggests that a transfer is optional and the Court has jurisdiction regardless of whether proceedings are transferred as the Respondents submitted. That is one basis why costs should not be awarded to the Applicants. Secondly the Applicants should not be compensated for the costs of the transfer of the proceeding from the Local Court because no unreasonable behaviour by the Respondents in relation to that notice of motion has been demonstrated to justify a costs order beyond the Applicants submitting that commencing the Local Court proceeding was unreasonable in their opinion. Thirdly the Respondents agreed that the order to transfer ought be made as reflected in the making of consent orders by the Court on 30 November 2023 and so costs were minimised. Fourthly as observed in Fox v Ginsberg (No 3) [2011] NSWLEC 139 at [13] in the context of applications under the Trees Act, it should not be assumed that legal costs will be awarded by the Court given the focus on the just, quick and cheap resolution of such matters. The same observations apply to matters under the DF Act. It is not essential to have legal representation to seek orders for the transfer of Local Court DF Act proceedings to the Court.
As I am not making a costs order in favour of either party I do not need to consider submissions made by the Respondents that they were put to extra cost due to the amendment of the Trees Act application by the Applicants which should not be awarded to the Applicants. That the application was amended to include reliance on an arborist report is part of the usual procedural steps that may be necessary in such matters.
I also observe that none of the cases relied on by the Applicants at section E of their written submissions where costs have been awarded in tree dispute matters are similar to this case and those cases have no application.
No parties are successful in relation to their notice of motion and these will be dismissed. Each party should pay their own costs of the notices of motion in light of that determination.
[10]
Orders
The Court orders:
1. The Applicants' notice of motion dated 12 June 2023 is dismissed.
2. Each party to pay their costs of the notice of motion dated 12 June 2023.
3. The Respondents' notice of motion filed 13 June 2024 is dismissed.
4. Each party to pay their costs of the notice of motion filed 13 June 2024.
[11]
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: 10 July 2024
[12]
Rule 3.7(2) of the LEC Rules reflects the presumptive rule based on the no discouragement principle that a person should not be discouraged from making or defending an application because of the risk of an adverse costs order, Arden Anglican School v Hornsby Shire Council(2008) 158 LGERA 224; [2008] NSWLEC 103 at [10] cited in Popovac v Kennedy[2022] NSWLEC 9 (Popovac) at [31]. The Court has discretion to decide if costs ought be payable. Circumstances where a costs order may be made are identified in subr (3) of r 3.7. The circumstances identified in subr (3) are not exhaustive. The usual rule that each party pays their own costs is informed by the nature of these proceedings, see Smith v Kaddour(No 2)[2018] NSWLEC 21 at [25].
In Marks v Perham (No 2)[2020] NSWLEC 84 at [29]- [30] cited in Popovac at [32] Robson J helpfully stated:
[13]
29 The no discouragement principle is particularly important in the context of applications made pursuant to the Trees Act, as such applications are subject to the Court's Practice Note Class 2 - Tree Applications which is designed to facilitate the just, quick and cheap resolution of tree disputes through an appropriate and easily accessible procedure.
30 In approaching the task before me, I consider that it is appropriate, first, to identify whether there is anything within the judgment of the Commissioner which indicates that an order for costs may be fair and reasonable; and second, to look to the conduct of the parties both before and during the hearing for any indication that such an order may be appropriate.
[14]
The evidence read on each notice of motion was considered in relation to both notices of motion. The affidavit of Ms Wang dated 6 June 2024 was read in part, including several paragraphs identifying correspondence between the parties' solicitors after the Class 2 application had been filed up to the hearing date. This overlapped with correspondence for the same period annexed to the affidavit of Mr Hanna solicitor dated 13 June 2024 which was also read in part.
As I ruled during the hearing on costs that correspondence between the parties leading up to the filing of the Class 2 application is irrelevant that need not be set out. The parties agreed the following correspondence contained their attempts at settlement negotiations after the Class 2 application was filed leading up to the hearing on 31 January 2024, as referred to in their respective affidavits and summarised in the following table (marked MFI 1).
[15]
Respondents sent a first response demanding a different fencing proposal to that sought under the fencing notice, and refused to remove any tree.
[16]
Applicants requested to transfer Respondents' fencing application into the Court at direction hearing. Applicants filed a notice of motion to transfer.
[17]
Respondents opposed the transfer order before and during direction hearing.
[18]
(Facts in dispute on the reason why order was not granted)
[19]
Applicants raised questions about the offer and received no reply.
[20]
Both Applicants' and Respondents' solicitors' offices closed for the holiday period.
[21]
Respondents filed affidavits and expert report dated 2 November 2023. Respondents sent proposed orders to Applicants.
[22]
In the course of the hearing I would not permit either party to make submissions or rely on evidence seeking to establish that one of them unreasonably failed to settle the matter before proceedings were commenced, circumstances they sought to make relevant under r 3.7(3)(c). The AC made an express finding at [42] as follows:
[23]
42 Regardless that they are currently in deep dispute, the parties have communicated and negotiated about the trees and fence for over two years. Based on the history informing the dispute and other adduced evidence, both parties have invested considerable sustained efforts towards reaching agreement, more than is necessarily required. Consequently, I am satisfied the applicants have made a reasonable effort to reach agreement with the owners of the land on which the trees are situated, such that s 10(1)(a) of the Act is engaged.
[24]
That finding in relation to s 10(1)(a) of the Trees Act means that it is not appropriate in this costs matter that the parties seek to re-litigate matters that the AC had regard to in coming to the view that there had been reasonable settlement efforts. No basis exists in Wang No 1 for considering r 3.7(3)(c) of the LEC Rules in the context of settlement negotiations between the parties before proceedings commenced.
[25]
Both the Applicants and Respondents alleged unreasonable behaviour by the others during the proceedings (relying on r 3.7(3)(d)) as the parties continued to seek to settle the matter after proceedings were commenced with numerous written offers made between the parties' solicitors, as set out above in [11]. Both parties submitted each other's behaviour was unreasonable in not settling in this period as according to each of them the final orders made by the AC were in similar terms or better than offers made in this period.
Ms Wang submitted that the offers made were in similar terms to the AC's orders and the Respondents were unreasonable in not accepting the settlement offers made. The Respondents made the same submission reflecting partially their assessment of what was offered and what the AC ordered. The focus of arguments was a detailed settlement offer dated 29 January 2024 from the Applicants and a detailed counter offer on 30 January 2024 being an offer made just before the hearing on 31 January 2024.
Ms Wang also alleged based on essentially the same arguments made in relation to settlement negotiations that the Respondents lacked reasonable prospects of success relying on subr 3(f)(i).
[26]
I have read Wang No 1 as a whole including comparing the lengthy orders made by the AC compared to the orders sought by the parties, and having read the numerous settlement offers made in the period 16 November 2023 to 30 January 2024 set out in the table above, I can conclude that there was no clear winner or loser in the orders made by the AC. The parties had identified a number of issues between them in relation to which of the Respondents' trees should be removed or trimmed, and what kind of fence if any should be installed on the boundary and what should be done about any services that might by in the way of a boundary fence.
Submissions were made that the Respondents unreasonably refused a boundary survey, but this was agreed to by them in the correspondence with costs to be shared suggesting this became a non-issue. Various examples according to the Applicants of non-compliant proposals for boundary fencing of certain heights and using pine sleepers were referred to. These were the subject of the ongoing negotiation between the parties. The Applicants' submissions that the Respondents failed to understand their responsibility to trim their trees in relation to powerlines is addressed in Wang No 1 at [56] and no basis exists for such a submission. I do not accept the Applicants' submissions that the Respondents failed in every material aspect of their DF Act application, indeed I consider they were largely successful.
It is unnecessary to canvas in full the extremely detailed submissions of the Applicants in particular about what were submitted to be reasonable offers on their part which the Respondents should have accepted in their view given I have reviewed the material relied on by the parties. As already held neither party was entirely successful in the matters they pursued before the AC. The last settlement letter sent by the Respondents' solicitor the day before the hearing dated 30 January 2024 offered to settle in reasonably similar terms to the AC's final orders. I also accept the Applicants' submission that that letter of offer did not adequately deal with underground utility services and how tree trimming costs ought be shared. In essentially the same way that the AC found the parties had engaged in reasonable settlement efforts over two years at [42], there is no basis to support a finding of unreasonable behaviour in relation to the conduct of any of the parties such as to warrant a costs order pursuant to r 3.7(3)(d) as a result of their very detailed but ultimately unsuccessful settlement negotiations in the period being considered. No party succeeds on this basis.
This finding also essentially deals with the Applicants' submission that the Respondents maintained the proceedings without reasonable prospects of success (subr (f)(i)). There is simply no basis in Wang No 1 to support that submission. The Respondents were successful in having some of the orders sought by the Applicants not made at all or varied. The Applicants were unsuccessful in several matters identified above in the summary of Wang No 1. The Applicants' position that the existing fence was sufficient under the DF Act was not accepted and the parties were ordered to build a new boundary fence, with the cost to be shared, as is usual for boundary fences and provided for in the DF Act. The Respondents had offered this outcome in the lead up to the hearing. I do not accept the Respondents' defence (noting that response is a more appropriate term in a Trees Act matter) lacked reasonable prospects of success and the Applicants are unsuccessful on this basis.
[27]
The Applicants alleged the Respondents defended the proceeding for an improper purpose. The Applicants' assertions that the Respondents were pursuing an illegal fencing proposal, which seemed to underpin several arguments I had difficulty understanding, did not arise from any matter identified in the AC's judgment. The submission related to a proposal for pine sleepers to be used under the boundary fence, which was said to not comply with a relevant state environmental planning policy. I do not need to resolve that question in order to resolve whether costs ought be payable. The AC made an order that the new boundary fence must have no aboveground components made of combustible material and referred to not using pine sleepers. It was not a matter that the AC dealt with substantively and is not self-evidently a basis for submitting unlawfulness in relation to the entire proceedings or that the Respondent defended the proceedings for an improper purpose, a serious allegation (subr (3)(e)). No factual or legal basis exists for such a broad submission to be made. The Applicants are not successful on this basis.
[28]
Both parties made different submissions to that effect that there were questions of fact or mixed fact and law which were determinative of the proceedings such that their costs ought be paid.
The Respondents referred to the compensation being sought by the Applicants of $4,992.50 for the installation of a wire mesh fence. At issue was whether these were 'spot repairs' or 'urgent fencing work' under the DF Act, the AC finding they were not. The Applicant also sought an order for repair of the existing mesh fence and this was also not accepted in Wang No 1. Given the range of issues before the AC, these issues while relevant to his ultimate decision are not so obviously dominant in the outcome of the proceeding that a costs order is warranted on this basis in the Respondents' favour.
The matters identified by the Applicants were that the Applicants' Trees Act application was found to have satisfied the notice requirements in s 8(1) of the Trees Act at Wang No 1 at [28]-[32], despite the Respondents' argument to the contrary, one of many matters the AC considered. Another matter identified by the Applicants termed 'repair of an existing hardwood fence' did not appear to arise from any issue identified in Wang No 1. In any event these submissions largely related to issues that were part of the merits review by the AC.
Neither party has established a basis to award costs under r 3.7(3)(a) in relation to a determinative issue.
[29]
Costs of transfer of Local Court proceeding not payable to Applicants
[30]
The Applicants also sought their costs of the notice of motion filed in the Court seeking transfer of the Local Court proceeding commenced by the Respondents in reliance on the DF Act to the Court. I infer the Applicants considered that the Respondents acted unreasonably in commencing the Local Court proceeding necessitating transfer to the Court.
The relevant circumstances are as follows:
[31]
Local Court proceeding (DF Act application) commenced by the Respondents.
[32]
Direction 1A - an order under the DF Act transferring the Local Court proceeding to the Court was not made.
[33]
Applicants filed the notice of motion dated 22 November 2023 seeking an order that the Local Court proceeding be transferred to the Court.
[34]
1. The notice of motion filed 22 November 2023 is granted by consent.
[35]
2. Under Section 13A(3) of the DF Act, order to transfer Local Court proceeding to the Court, with evidence and orders in one proceeding being evidence in all.
[36]
The Applicants submitted that they had to have the Local Court proceeding transferred to the Court in order for the DF Act matters to be considered. The Respondents submitted that was not necessary as the Court had jurisdiction in any event. The Registrar did not make an order for transfer of the proceeding on 21 November 2023 for that reason. The Applicant's notice of motion dated 22 November 2023 was unnecessary.
I do not have the benefit of the transcript of the proceeding before the Registrar on 21 November 2023 so that the parties' arguments are not precisely known and the Registrar's reasons not before the Court now. Firstly, the Court has jurisdiction in relation to DF Act matters under s 13A(1) when dealing with matters under s 7 of the Trees Act, see s 13(2) of the DF Act. The DF Act has provision for the transfer of proceedings in s 13A(3) which states that the Court may (my emphasis) on its own motion or on a party's application transfer proceedings. These sections suggests that a transfer is optional and the Court has jurisdiction regardless of whether proceedings are transferred as the Respondents submitted. That is one basis why costs should not be awarded to the Applicants. Secondly the Applicants should not be compensated for the costs of the transfer of the proceeding from the Local Court because no unreasonable behaviour by the Respondents in relation to that notice of motion has been demonstrated to justify a costs order beyond the Applicants submitting that commencing the Local Court proceeding was unreasonable in their opinion. Thirdly the Respondents agreed that the order to transfer ought be made as reflected in the making of consent orders by the Court on 30 November 2023 and so costs were minimised. Fourthly as observed in Fox v Ginsberg(No 3)[2011] NSWLEC 139 at [13] in the context of applications under the Trees Act, it should not be assumed that legal costs will be awarded by the Court given the focus on the just, quick and cheap resolution of such matters. The same observations apply to matters under the DF Act. It is not essential to have legal representation to seek orders for the transfer of Local Court DF Act proceedings to the Court.
As I am not making a costs order in favour of either party I do not need to consider submissions made by the Respondents that they were put to extra cost due to the amendment of the Trees Act application by the Applicants which should not be awarded to the Applicants. That the application was amended to include reliance on an arborist report is part of the usual procedural steps that may be necessary in such matters.
I also observe that none of the cases relied on by the Applicants at section E of their written submissions where costs have been awarded in tree dispute matters are similar to this case and those cases have no application.
No parties are successful in relation to their notice of motion and these will be dismissed. Each party should pay their own costs of the notices of motion in light of that determination.
[37]
(1) The Applicants' notice of motion dated 12 June 2023 is dismissed.
(2) Each party to pay their costs of the notice of motion dated 12 June 2023.
(3) The Respondents' notice of motion filed 13 June 2024 is dismissed.
(4) Each party to pay their costs of the notice of motion filed 13 June 2024.