BETWEEN : WESTERN AUSTRALIAN PLANNING COMMISSION

Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL OF WESTERN AUSTRALIA

Practice and procedure - Costs - Application for leave to appeal against a decision of the State Administrative Tribunal dismissing an application for costs - Respondent commenced proceedings in the State Administrative Tribunal to determine the value of land pursuant to s 188(2)(b) of the Planning and Development Act 2005 (WA) - Appellant subsequently applied to the State Administrative Tribunal for the determination of a preliminary issue - Respondent discontinued proceedings - Appellant made an application for costs - Appellant's application for costs was dismissed - Whether the State Administrative Tribunal exercised discretion not to award costs in a way that was so unreasonable that no reasonable Tribunal could have come to that decision

Planning and Development Act 2005 (WA), s 173, s 174, s 187, s 188

State Administrative Tribunal Act 2004 (WA), s 9, s 16, s 46, s 47, s 48, s 54, s 87, s 88, s 89, s 105

State Administrative Tribunal Rules 2004 (WA), r 40, r 41, r 42, r 42A, r 43

AMP Capital Investors Ltd v Transport Infrastructure Development Corporation [2008] NSWCA 325; (2008) 163 LGERA 245

AMP Capital Investors Ltd v Transport Infrastructure Development Corporation [No 3] [2007] NSWLEC 724

Associated Provincial Picture Houses Limited v Wednesbury Corporation [1947] EWCA Civ 1; [1948] 1 KB 223

Banno v Commonwealth of Australia (1993) 45 FCR 32

Brock v Roads and Maritime Services (formerly Roads and Traffic Authority of NSW) [No 3] [2012] NSWCA 404; (2012) 191 LGERA 267

Chief Executive Officer, Department for Child Protection v Hardingham [2011] WASCA 262; (2011) 214 A Crim R 259

Clifford and Shire of Busselton [2007] WASAT 89 (S); (2007) 52 SR (WA) 58

Commissioner for Consumer Protection v Carey [2014] WASCA 7

IBN Corporation Pty Ltd v Banjyma Aboriginal Corporation [2009] WASC 279

Lourey v Legal Profession Complaints Committee [2012] WASCA 112

McKay v Commissioner of Main Roads [2013] WASCA 135

Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24

Minister for Immigration and Citizenship v Li [2013] HCA 18; (2013) 249 CLR 332

Minister for Immigration and Multicultural Affairs v Eshetu [1999] HCA 21; (1999) 197 CLR 611

Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme [2003] HCA 8; (2003) 216 CLR 212

Minister for the Environment v Florence (1979) 21 SASR 108

Miwa Pty Ltd v Siantan Properties Pte Ltd [No 2] [2011] NSWCA 344

Ohn v Walton (1995) 36 NSWLR 77

Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72

Paridis v Settlement Agents Supervisory Board [2007] WASCA 97; (2007) 33 WAR 361

Pastrello v Roads and Traffic Authority of New South Wales [2000] NSWLEC 209; (2000) 110 LGERA 223

Port Stephens Council v Sansom [2007] NSWCA 299; (2007) 156 LGERA 125

Tempe Recreation (D.500215 and D.1000502) Reserve Trust v Sydney Water Corporation [2014] NSWCA 437; (2014) 88 NSWLR 449

Winterbourn and Western Australian Planning Commission [2013] WASAT 72

1 MARTIN CJ: This application for leave to appeal from a decision of the State Administrative Tribunal (Tribunal) should be dismissed for the reasons given by Murphy JA, with which I agree. However, I wish to add the following observations of my own.

The grant of leave to appeal from a decision of the Tribunal

2 Section 105 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) provides that a party to a proceeding in the Tribunal may appeal from a decision of the Tribunal to the Supreme Court.[1] The section places two significant constraints upon the right of appeal which it confers. First, appeals can only proceed if the court to which the appeal lies grants leave.[2] Second, appeals can only be brought 'on a question of law'.[3]

3 A number of inferences of legislative intention can be drawn from the express constraints which have been placed upon the right of appeal conferred by s 105 of the SAT Act. First, by restricting appeals to appeals 'on a question of law'[4] it can be inferred that the legislature intended that review by the court would be limited to questions of law. So, questions of fact, practice and procedure, policy or discretion can only be reviewed by the court if and to the extent that they must necessarily be determined in order to determine the question of law upon which the appeal has been brought. This limitation upon the role of the court is consistent with the different functions and responsibilities of the Tribunal as compared to the court. The Tribunal is an administrative body charged with the responsibility of making decisions on their merits in accordance with the SAT Act. In the exercise of that jurisdiction it will be necessary and appropriate for the Tribunal to determine questions of law and, to that extent, its jurisdiction is coincident with the jurisdiction of the court to determine such questions in the course of proceedings before it. However, the court has no general jurisdiction to determine administrative matters on their merits, and the restriction of appeals to the court to appeals on questions of law reflects the differing nature of the jurisdictions of the Tribunal and the court respectively.

4 Second, it can be inferred from the express requirement that appeals can only proceed with the leave of the court that the legislature intended that the court should exercise a discretion with respect to decisions of the Tribunal which should be subjected to review on a question of law. Put another way, it follows from the requirement that leave be granted that the legislature did not intend that every appeal on a question of law from a decision of the Tribunal should, for that reason alone, be entertained by the court. Without attempting to constrain the circumstances in which the discretion will be exercised and leave granted, the court has enunciated principles which will guide the exercise of its discretion.[5]

5 The legislative objectives which are to be inferred from s 105 of the SAT Act and to which I have referred will be undermined unless the court is assiduous to ensure that its review is constrained to appeals brought on questions of law only, and restricts the grant of leave to cases in which such a review is appropriate. Questions of practice and procedure will seldom give rise to questions of law. Even in those rare cases in which questions of practice and procedure do give rise to a question of law, ordinarily it will be appropriate for the court to take into account the particular expertise of the Tribunal with respect to the development of its own practices and procedures, and to exercise considerable restraint in the grant of leave to appeal in such cases.

6 In this case the Western Australian Planning Commission (WAPC) applies for leave to appeal from a decision of the Tribunal on a question of practice and procedure, namely the exercise of the discretion conferred upon the Tribunal with respect to orders for the payment of the costs of parties to the proceedings before the Tribunal. Although the WAPC has endeavoured to formulate its contentions in terminology often used with respect to questions of law, in this case that terminology is nothing more than a cloak or disguise for what is in substance nothing more than a complaint that the discretion conferred upon the Tribunal should have been exercised in its favour. In substance rather than in form, this appeal is not brought 'on a question of law' and does not therefore come within the jurisdiction conferred upon the court by s 105 of the SAT Act. Further, even if the appeal did lie within the jurisdiction of the court, because it is concerned with questions of practice and procedure, and with the exercise of the Tribunal's discretion with respect to costs, it would not ordinarily be appropriate for the court to exercise its discretion in favour of the grant of leave to appeal.

The Tribunal's discretion with respect to costs

7 As Murphy JA notes, in the decision the subject of this application, the President of the Tribunal referred with apparent approval to an earlier decision of the Tribunal in Winterbourn and Western Australian Planning Commission[6] in which reliance was placed upon the decision of the Tribunal in Clifford and Shire of Busselton.[7] In that case, the then President, Barker J, observed:[8]

Ordinarily, where a citizen feels obliged to commence a proceeding in the Tribunal for compensation under the [Land Administration Act 1997 (WA)] they are dissatisfied with and have rejected an offer of compensation made by a resuming authority. If they succeed in their claim in the Tribunal, it would seem fair and reasonable that the Tribunal should ordinarily exercise its discretion under s 87(2) and award the applicant the costs of those proceedings. This is because, putting it simply, ordinarily if the applicant succeeds, it will have been demonstrated to the Tribunal that the applicant was not offered fair compensation by the resuming authority and was obliged to commence and maintain the proceedings in order to gain justice. It would seem unreasonable for an applicant to have to fight to gain fair compensation only to have to deduct from the compensation the costs incurred in obtaining the award.

Of course what should be recognised as 'success' in every case requires some further consideration. If the applicant does not succeed in obtaining a compensation award following a hearing that betters the original compensation offer made by the resuming authority, it can hardly be said that the applicant was successful in the proceedings. Indeed it could be said in such a case that the applicant has maintained an unjustified proceeding and so should have to pay the respondent its costs for the trouble and expense of defending the claim.

Either way it really is a question of fairness: on the one hand, in the case of a successful applicant it is fair that they should ordinarily receive their costs when they are put to the trouble and expense of proving that their claim is right, over the reticence of the resuming authority to recognise the rightness of the claim; on the other hand, it is fair that an applicant who does not establish that a resuming authority's offer was not right, should have to pay the resuming authority's costs given the trouble and expense to which they have put the resuming authority.

It should also be said that an award of costs in such circumstances will have the beneficial effect of discouraging unjustified proceedings.

8 In each of Winterbourn and in this case, the Tribunal appears to have treated the observations made by Barker J as giving rise to a presumption that a particular practice will be adopted in the exercise of the Tribunal's jurisdiction with respect to the determination of compensation for the resumption of land. The practice said to be expounded in these decisions is to award costs in favour of the land owner if the compensation awarded by the Tribunal exceeds the offer made by the resuming authority, whereas costs will be ordered in favour of the resuming authority if the compensation awarded by the Tribunal is less than the offer made.

9 For the reasons given by Murphy JA, such an approach is not consistent with the provisions of s 87 of the SAT Act. Rather, s 87 requires the Tribunal to exercise the discretion which it confers taking into account all the circumstances of the particular case, including the nature of the jurisdiction which the Tribunal has been called upon to exercise, and any rules which have been promulgated by the Tribunal, but starting from the presumption that no order for costs will be made. In cases such as this, the fact that the jurisdiction arises from a unilateral decision by a resuming authority to expropriate the proprietary interests of a land owner will be material to the exercise of the discretion conferred by s 87 of the SAT Act. As Barker J observed in Clifford, a land owner who is ordered to pay the costs of the resuming authority in relation to proceedings in the Tribunal for the determination of the compensation to which the land owner is entitled will, by reason of such an order, be deprived of full compensation for the property which has been expropriated. Such a consequence could only be fair and reasonable if it is justified by conduct on the part of the land owner which is inappropriate or unreasonable, or which impedes the Tribunal in the achievement of the objectives to which reference is made in s 9 of the SAT Act.

10 With respect to Barker J, it cannot be concluded from the mere fact that the compensation determined by the Tribunal is less than that offered by the resuming authority that the land owner 'has maintained an unjustified proceeding and so should have to pay the respondent its costs for the trouble and expense of defending the claim'. Of course this is not to say that such a conclusion could not be drawn in a case in which the land owner maintained a claim for an amount of compensation which was greatly in excess of the amount ultimately determined by the Tribunal. However, to the extent that the reasons of Barker J suggest that any land owner who fails to 'beat the offer' made by a resuming authority should be ordered to pay the resuming authority's costs of the proceeding, in my respectful view such a suggestion is contrary to s 87 of the SAT Act, and

should not be followed by the Tribunal. In this context it should be noted that the State Administrative Tribunal Rules 2004 (WA) promulgated by the Tribunal do not provide that a party who makes an offer more favourable to another party than the result achieved in the Tribunal is, by reason of that fact above, entitled to an order for costs. Rather the relevant rule[9] merely provides, perhaps superfluously, that the Tribunal must take such matters into account.

11 The appellant, Western Australian Planning Commission (WAPC), seeks leave to appeal under s 105 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) against a decision of Curthoys J in the State Administrative Tribunal (Tribunal) dated 28 January 2015. His Honour, in extempore reasons, dismissed WAPC's application for costs following the discontinuance of proceedings commenced by the respondent (Questdale) in the Tribunal.

12 The proceedings arose in the following context. Questdale, as owner of certain land in Mandogalup, applied for development approval for sand mining. At the time of the application the land had been included in 'Bush Forever', pursuant to State Planning Policy 2.8, and reserved in the Metropolitan Region Scheme. After the development application was refused, Questdale made a claim for compensation for injurious affection. WAPC elected to acquire the relevant land in lieu of paying compensation for injurious affection. A dispute arose as to its value and on 23 December 2013, Questdale commenced proceedings in the Tribunal to determine the value of the land pursuant to s 188(2)(b) of the Planning and Development Act 2005 (WA) (PD Act).

13 On 31 October 2014, the Tribunal granted leave to Questdale to discontinue the proceedings, but kept open the question of costs.

14 WAPC sought costs in the sum of $60,000. On 28 January 2015, in the decision under appeal, Curthoys J dismissed WAPC's application for costs.

The history of the proceedings[10]

15 In order to put the Tribunal's decision in context, it is necessary to outline the history of the proceedings.

16 Following the commencement of the proceedings by Questdale in the Tribunal on 23 December 2013, the first mediation conference was held on 16 April 2014. Prior to the first mediation conference, the parties had exchanged points for mediation.

17 Following the first mediation conference, the parties prepared and filed environmental reports on 28 May 2014, and the parties' environmental experts conferred with the Tribunal on 3 June 2014. On 19 June 2014, a joint statement of the environmental experts was filed in the Tribunal.

18 On 18 July 2014, Questdale filed its statement of facts, issues and contentions, and on 15 August 2014, WAPC filed its statement of facts, issues and contentions. In its statement of facts, issues and contentions, Questdale contended that WAPC's valuations erroneously assumed that the environmental characteristics of the land meant that there would be no approval given to clear any of the native bushland on the property with or without the reserve or the Bush Forever classification in place.[11] WAPC alleged that the land had environmental value and was protected under environmental legislation and policies, independently of the reservations.[12]

19 On 26 August 2014, the parties attended a further mediation conference.

20 On 8 September 2014, the State Solicitor's Office on behalf of WAPC wrote to the Tribunal in terms including:

[WAPC] is writing to the Tribunal to:

...

(b) Request a hearing on a preliminary issue. [WAPC] has reached the view that the resolution of a preliminary issue would assist the parties in the disposition of this matter. At this time, it is apparent from the parties' Statements of Facts, Issues and Contentions that there are issues in contest between the parties as to [the] correct application of section 188 of the PD Act in relation to determining the value of Lot 3.

The preliminary issue that the [applicant] has identified is:

Does s 188(1)(b) PD Act require the Tribunal to disregard any aspect of 'Bush Forever' published in 2000 or State Planning Policy 2.8 adopted in 2010? (the Preliminary Issue.)

The preliminary issue appears to be the central difference between the valuers for each side. The principle of law that will determine that central issue will also determine other questions in the hearing, namely (a) other valuation issues; (b) the extent of environmental evidence; and (c) the extent of planning evidence.

21 In support of its application for the determination of a preliminary issue, WAPC filed submissions dated 13 October 2014, which included:

1. The preliminary question has never been addressed. The identical question will arise in other proceedings, namely:
   • White v WAPC, which arose under s 176(2) PD Act, and is to be heard early in 2015 by arbitrator Mr Martin Flint.
   • Prestage and WAPC (DR 180 of 2014) which is likely to be set down for hearing in the Tribunal in April or May of 2015.
2. More such cases are likely because about 4600 ha of privately owned land has been identified in Bush Forever ...
3. It would be generally of assistance to such other litigation for a definitive answer to be given soon.

22 On 15 October 2014, the solicitors for Questdale wrote to the State Solicitor's Office and said:

We have sought advice from Senior Counsel on the matters you raised, and our instructions are set out below.

The decision of Nicoletti v WAPC [2006] WASC 131 articulated the proposition that a land owner may withdraw their application for compensation at any time before the claim is resolved and submit, at a later time, a further application in relation to a revised development application.

Please obtain instructions from your client as to whether it agrees with this approach.

We confirm that, subject to your response, [Questdale] will withdraw both the application to determine the value of land with the State Administrative Tribunal, and the claim for compensation before the Western Australian Planning Commission.

23 On 31 October 2014, Deputy President, Judge Parry ordered that, pursuant to s 46(1) of the SAT Act, Questdale had leave to withdraw the proceeding subject, in effect, to a determination of WAPC's foreshadowed application for costs.

24 The primary judge referred to a decision of Deputy President, Judge Parry in Winterbourn and Western Australian Planning Commission,[13] which in turn referred to an earlier decision of Barker J in Clifford and Shire of Busselton.[14]

25 The gravamen of the primary judge's decision was that costs ought not to be ordered in the instant case because:[15]

(a) the Tribunal was not a 'cost jurisdiction [where] a withdrawal prima facie leads to an entitlement to costs';

(b) rather, the jurisdiction being exercised by the Tribunal was a 'cost-neutral jurisdiction, although ... in this particular area costs are typically ordered';

(c) it was not a case where there was any 'long delay', in that the withdrawal was foreshadowed shortly after WAPC raised for determination the proposed preliminary question of law;[16] and

(d) although Questdale had been engaged in 'cost shifting', parties ought nevertheless 'not be discouraged from withdrawing matters in a cost-neutral jurisdiction unless there is something particularly in the conduct, such as the lateness in Westbourne [sic - Winterbourn], that would lead to a cost penalty being imposed'.

The statutory scheme Compensation and acquisition under the PD Act

26 Section 173(1) of the PD Act provides that, subject to pt 11 of that Act, any person whose land is injuriously affected by the making or amendment of a planning scheme is entitled to obtain compensation in respect of the injurious affection from the responsible authority.

27 Section 174(1) of the PD Act provides for the events or circumstances by reason of which land is 'injuriously affected' for the purposes of pt 11 of the Act.

28 Section 187(1) of the PD Act provides that where compensation for injurious affection is claimed as a result of the operation of the provisions of s 174(1), the responsible authority 'may at its option elect to acquire the land so affected instead of paying compensation'.

29 By s 187(3), if following such an election the responsible authority and the owner are unable to agree as to the price to be paid for the land, the price at which the land may be acquired by the responsible authority is to be the value of the land as determined in accordance with s 188. Section 187(4) provides, in effect, that if an owner of land claims compensation and the responsible authority elects to purchase the land, and the price to be paid for the land by the responsible authority has not been determined for the purposes of s 187(3), the owner of the land may withdraw the claim for compensation and, upon that withdrawal, the election has no effect.

(1) The value of the land referred to in section 187(3) is to be -

(a) the value of the land on the date the responsible authority elects to acquire the land under that section; and

(b) determined without regard to any increase or decrease, if any, in value attributable wholly or in part to the planning scheme.

(2) Subject to subsection (4), the value of the land referred to in section 187(3) is to be determined -

(a) by arbitration in accordance with the Commercial Arbitration Act 2012; or

(b) by the State Administrative Tribunal on the owner of the land applying to it for a determination of that value; or

(c) by some other method agreed upon by the responsible authority and the owner of the land.

31 By s 46(1) of the SAT Act, an applicant may, with the Tribunal's leave, withdraw or agree to the withdrawal of a proceeding or a part of a proceeding. By s 46(5), the Tribunal may make an order under s 46 on the application of a party or on its own initiative. By s 47 of the SAT Act, the Tribunal may order that a proceeding be dismissed or struck out and make any appropriate orders if satisfied that the proceeding is frivolous, vexatious, misconceived or lacking in substance, being used for an improper purpose or is otherwise an abuse of process. By s 48, the Tribunal may, amongst other things, order that a proceeding be dismissed or struck out if the Tribunal believes that an applicant is proceeding in a way that unnecessarily disadvantages the other party by conduct including the vexatious conduct of the proceedings.

(1) Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal.

(2) Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35.

(3) The power of the Tribunal to make an order for the payment by a party of the costs of another party includes the power to make an order for the payment of an amount to compensate the other party for any expenses, loss, inconvenience, or embarrassment resulting from the proceeding or the matter because of which the proceeding was brought.

(4) Without limiting anything else that may be considered in making an order for the payment by a party of the costs of another party where the matter that is the subject of the proceeding comes within the Tribunal's review jurisdiction, the Tribunal is to have regard to -

(a) whether the party (in bringing or conducting the proceeding before the decision-maker in which the decision under review was made) genuinely attempted to enable and assist the decision-maker to make a decision on its merits;

(b) whether the party (being the decision-maker) genuinely attempted to make a decision on its merits.

(5) The rules may deal with the effect of certain offers to settle, and responses, if any, to the offer, on the making of an order for the payment by a party of the costs of another party.

(6) The Tribunal may order that the representative of a party, rather than the party, in the representative's own capacity compensate that or any other party for costs incurred because the representative acted in, or delayed, the proceeding in a way that resulted in unnecessary costs.

33 Section 88 of the SAT Act deals with costs, other than the costs of a party, to proceedings. It provides:

costs of a proceeding means costs of, or incidental to, a proceeding of the Tribunal, other than costs of a party.

(2) The Tribunal may order that all or any of the costs of a proceeding be paid by a party.

(3) If the matter that is the subject of the proceeding comes within the Tribunal's review jurisdiction, the Tribunal cannot make an order under this section against a party unless -

(a) the party brought or conducted the proceeding frivolously or vexatiously; or

(b) section 87(4) applies to the party; or

(c) circumstances have arisen in which the Tribunal could make an order under section 46, 47 or 48.

If the Tribunal makes an order under this Division for the payment of costs and does not fix the amount of costs, that amount is to be assessed or settled in accordance with the rules.

35 As noted earlier, s 87(5) of the SAT Act provides that the rules may deal with the effect of certain offers to settle, and responses, if any, to the offer, on the making of an order for the payment by a party of the costs of another party. The relevant rules appear in div 5 and div 6 of the State Administrative Tribunal Rules 2004 (WA) (SAT Rules).

36 The principal rule is r 42, which applies to a proceeding other than a proceeding in the Tribunal's review jurisdiction, ie, to a proceeding in its original jurisdiction.

1. Order for costs if settlement offer is rejected

(a) a party to a proceeding (other than a proceeding in the Tribunal's review jurisdiction) gives another party to the proceeding an offer in writing to settle the proceeding; and

(b) the other party does not accept the offer within the time the offer is open; and

(c) the offer complies with rules 40 and 41; and

(d) in the opinion of the Tribunal, the orders made by the Tribunal in the proceeding are not more favourable to the other party than the offer.

(2) If this rule applies, the Tribunal is to, in determining the costs that may be awarded, take into account that the party did not accept an offer more favourable than the Tribunal's order.

(3) In determining whether its orders are or are not more favourable to a party than an offer, the Tribunal -

(a) must take into account any costs it would have ordered on the date the offer was made; and

(b) must disregard any costs it ordered in respect of any period after the date the offer was received.

38 Rules 40 and 41, to which reference is made in r 42(1)(c), are in the following terms:

(1) An offer to settle a proceeding that is before the Tribunal may be made -

(a) with prejudice, meaning that any party may refer to the offer, or to any terms of the offer, at any time during the proceeding; or

(b) without prejudice, meaning that the Tribunal is not able to be told of the making of the offer until after it has made its decision in respect of the matters in dispute in the proceeding (other than in relation to the making of orders in respect of costs).

(2) If an offer does not specify whether it is made with or without prejudice, it is to be treated as if it had been made without prejudice.

(3) A party may make more than one offer.

(4) If an offer provides for the payment of money, the offer must specify the amount of money to be paid and when and how that money is to be paid.

(1) An offer may be open for acceptance for any period. However, an offer must be open for acceptance until the commencement of the hearing or until the expiry of a specified period after the offer is made, whichever is the shorter period.

(2) The minimum period that can be specified is 14 days.

(3) An offer cannot be withdrawn while it is open for acceptance without the permission of the Tribunal.

(4) In deciding whether to give permission, the Tribunal may examine the offer, even if it was made without prejudice.

(5) If the offer was made without prejudice, a member of the Tribunal who examines it for the purposes of subrule (4) must take no further part in the proceeding after determining whether or not to give permission.

(6) A party can only accept an offer by giving the party who made it a signed notice of acceptance.

(7) A party may accept an offer even though the party has made a counter-offer.

39 Division 6 of the SAT Rules also includes r 42A and r 43:

42A. Time within which costs application may be made

Subject to these rules, an application to the Tribunal for costs under this Division can be made within 21 days of the orders to which the application relates being made by the Tribunal.

(1) If the Tribunal makes an order under the Act Part 4 Division 5 for the payment of costs and does not fix the amount of costs, that amount is to be assessed or settled by the executive officer or a member of the Tribunal nominated by the President (the nominated member).

(2) An assessment of costs by the executive officer or a nominated member is to be taken to be an assessment of costs by the Tribunal.

(3) If -

(a) a party fails to attend an assessment of costs having been given reasonable notice of the assessment by the executive officer or a nominated member; and

(b) the assessment is adjourned as a result; and

(c) another party incurs additional costs because of the adjournment,

the executive officer or a nominated member may order that the party who failed to attend pay an amount fixed by the executive officer or nominated member in respect of the additional costs of the other party.

(4) An order under subrule (3) may be enforced under the Act section 85 as if it were a monetary order.

Appellate review and the alleged question of law

40 Under s 105(2) of the SAT Act, an appeal can only be brought on a question of law. An appeal on a question of law is in the nature of judicial review proceedings; the existence of a question of law is not merely a qualifying condition for, or a gateway to, an appeal, but is the subject of the appeal itself. An appeal on a question of law does not, and should not, open the door to an appeal by way of rehearing.[17]

41 In this appeal, senior counsel for WAPC informed the court[18] that the question of law raised was whether the Tribunal exercised its discretion in a way which was unreasonable in the Wednesbury[19] sense, ie, the Tribunal's decision was so unreasonable that no reasonable Tribunal could have come to it.[20]

42 The question of law identified by senior counsel for WAPC does not emerge with any clarity from WAPC's ground of appeal, which is effectively a clutch of standard administrative law complaints.

43 WAPC's ground of appeal is in the following terms:

In ruling that [WAPC] be refused an award of costs consequent upon [Questdale] withdrawing its claim for compensation under the Planning and Development Act 2005, the State Administrative Tribunal erred in law and exceeded its jurisdiction by addressing the wrong question and failing to consider relevant considerations; by failing to accord [WAPC] a procedurally fair hearing; and by adopting an irrational form of reasoning.

44 In written submissions, WAPC contended that the judge:

(1) addressed the wrong questions and failed to consider relevant matters insofar as his Honour confined his consideration to whether the discontinuance occurred late in the proceedings, and did so in the context that he regarded the jurisdiction being exercised as one in which costs were not generally ordered when the question that should have been addressed was whether a costs order was to be made in circumstances of compulsory acquisition where ordinarily costs are ordered against the unsuccessful party;

(2) failed to take into account two allegedly mandatory considerations being Questdale's unreasonable conduct in 'cost shifting' and the injustice to WAPC of that conduct;

(3) failed to provide procedural fairness insofar as he took into account, without hearing from the parties, the question of whether a costs order in this matter would have repercussions for other litigants contemplating discontinuance in other proceedings, when that matter could not be regarded as falling within an 'obvious and natural evaluation' of WAPC's application for costs;[21] and

(4) adopted a form of reasoning that no reasonable Tribunal could adopt in that:

(a) the judge disregarded the unreasonableness that he had found in relation to 'cost shifting';

(b) the order for costs in the jurisdiction being exercised, namely in a land compensation case, could not rationally affect the conduct of other litigants in those areas of the Tribunal's jurisdiction in which costs would not ordinarily be ordered; and

(c) it was not rational to found the order solely on the basis of whether the discontinuance was early or late when the guiding considerations related to the reasonableness of the discontinuing party's conduct and the fairness of the outcome.

45 A fifth point emerged in oral submissions. Although cloaked as a point concerning the rationality of the decision, in substance,[22] the complaint appeared to be that the judge, having accepted that WAPC gave notice of its position on the proper construction of s 188(1)(b) of the PD Act in points for mediation dated 28 February 2014,[23] should have inferred that Questdale unreasonably delayed its decision to withdraw the proceedings until 15 October 2014.

46 The effect of s 87(1) of the SAT Act is, relevantly, that each party in proceedings before the Tribunal is to bear its own costs, unless the Tribunal otherwise orders.

47 The power to make an order for one party to pay another party's costs is contained in s 87(2). In exercising the discretion in its review jurisdiction[24] the Tribunal is bound, by virtue of s 87(4), to take into account the considerations therein specified. Also, the effect of s 87(5) of the SAT Act and r 42(2) of the SAT Rules is that in its original jurisdiction[25] the Tribunal is required to take into account that a party did not accept an offer of settlement (made in compliance with r 40 and r 41) more favourable than the Tribunal's order.

48 Otherwise the factors which the Tribunal will be bound to take into account (mandatory considerations) and precluded from taking into account (irrelevant considerations) will be determined by implication from the subject matter, scope and purpose of the SAT Act properly construed.[26] The observations of Gaudron and Gummow JJ in Oshlack v Richmond River Council,[27] albeit in a different statutory context, are apposite:

The power conferred by the section is to be exercised judicially, that is to say not arbitrarily, capriciously or so as to frustrate the legislative intent. However, subject to such considerations, the discretion conferred is, to adapt the words of Dixon J, unconfined except in so far as 'the subject matter and the scope and purpose' of the legislation may enable an appellate court to pronounce the reasons given by the primary judge to be 'definitely extraneous to any objects the legislature could have had in view'.

49 Although s 87(2) does not in terms say that the discretion is to be exercised if it is fair and reasonable in all the circumstances of the case to do so,[28] the judicial nature of the exercise and the scheme of the SAT Act indicates that, broadly speaking, that is the legislative intention.

50 Unlike in curial litigation, the 'important principle commonly referred to as the "usual order as to costs"',[29] under which the successful party is prima facie entitled to his or her costs, has no application given the presumptive position or starting point under s 87(1) of the SAT Act that each party is to bear its own costs.

51 Section 87(2) is to be construed in the context that the legal rationale for an order for costs is not to punish the person against whom the order is made, but to compensate or reimburse the person in whose favour it is made.[30] That rationale is evident in s 87(3) of the SAT Act. Accordingly, even in a statutory context where the presumptive position is that no costs will be ordered, generally speaking, the question is whether, in the particular circumstances of the case, it is fair and reasonable that a party should be reimbursed for the costs it incurred.[31] The onus is on the party seeking an order in its favour.[32]

52 In a matter relating to its original jurisdiction, by virtue of s 16 of the SAT Act, the Tribunal is to deal with the matter in accordance with the SAT Act and the enabling Act. Relevantly for present purposes the enabling Act is the PD Act. The PD Act enables the owner of land to apply to the Tribunal for a determination of the value of the land where the responsible authority has elected to acquire the land instead of paying compensation for injurious affection: s 187 and s 188 of the PD Act. Section 188 of the PD Act makes no mention of costs.[33]

53 In this context, the nature of the dispute, which Parliament has given the landowner the option of having determined in a forum where the presumptive position is that each party is to bear its own costs, is a relevant consideration.[34] The dispute is in relation to the value of the landowner's land which is to be compulsorily acquired by the State. Adopting and adapting the observations of Wilcox J in Banno v Commonwealth of Australia,[35] this is 'not ordinary litigation'. The relationship between the parties giving rise to the litigation does 'not arise out of their mutual desire; [but rather] because of a unilateral decision' of the State 'to acquire the applicants' land in order to satisfy a perceived public need'. The acquisition leaves the landowner in the position of either accepting the State's assessment of the proper compensation or of having the Tribunal rule on its adequacy. Similarly, as has been observed in a not dissimilar context by the New South Wales Court of Appeal, the parties 'are not, or should not be, adversaries in the sense that can be said of the usual kind of civil litigation in courts'.[36]

54 An applicant landowner, like every party to proceedings before the Tribunal, is, however, taken to be cognisant of the Tribunal's objectives in s 9 of the SAT Act. Accordingly, in an application for costs against a landowner it will be relevant to consider whether and to what extent the responsible authority can establish that the landowner's conduct in connection with the proceedings has impaired the attainment of the Tribunal's objectives to have the proceedings determined fairly and in accordance with the substantial merits, with as little formality and technicality as possible, and in a way which minimises the costs to the parties.

55 Nevertheless, the mere fact that a landowner ultimately fails on some contention or contentions advanced at trial would not, in itself, signify that it has acted inconsistently with the objectives in s 9. That is particularly so in the context that under s 46, s 47 and s 48 of the SAT Act, plainly unmeritorious claims, or claims made or pursued in circumstances which, broadly speaking, may be characterised as involving misconduct, may be screened out before final hearing. The Tribunal in such circumstances may act on its own volition or on the application of a party.[37]

56 As Wilcox J suggested in Banno:[38]

[P]eople in that position should be allowed access to the Court, to present an arguable and well-organised case, without being deterred by the prospect of being ordered to pay the Commonwealth's costs if their case proves unpersuasive. I distinguish the situation of resumees who pursue a vexatious, dishonest or grossly exaggerated claim or present their case in such a way as to impose unnecessary burdens on the Commonwealth or the Court.

57 The observations of Wilcox J in Banno, referred to in [53] and [56] above, were effectively endorsed by the New South Wales Court of Appeal in an analogous, although not identical, statutory context in Brock v Roads and Maritime Services (formerly Roads and Traffic Authority of NSW).[39]

58 The nature of the dispute for determination, ie, the value of the land in the context of compulsory acquisition, will be a factor in the exercise of discretion under s 87(2) in favour of the landowner in proceedings where the responsible authority has been unsuccessful in the forensic contest. That is not in recognition of a rule that costs follow the event. Rather, it is a recognition that, generally speaking, the legislative purpose will be served by 'the claimant ... [receiving] his reasonable costs of obtaining the compensation that is, ex hypothesi, his due'.[40] Even there, however, it would remain relevant to consider whether it would be fair and reasonable for the 'successful' landowner to be deprived of its costs, or part of its costs, in all the circumstances of the case, including having regard to the matters referred to earlier.

59 The above observations proceed on the basis that there is no offer that the Tribunal is obliged to consider pursuant to s 87(5) of the SAT Act and r 42 of the SAT Rules. Where r 42 applies, the weight to be given to that mandatory consideration will be a matter for the Tribunal in each case. On the one hand, its importance as a factor is informed by the evident legislative intent that, where possible, parties to proceedings should endeavour to consider settlement. As Barker J observed in Clifford:[41]

The SAT Act therefore, through s 87(5) and the rules referred to, reveals parliamentary support for the idea that, where possible, parties to proceedings should endeavour to consider settlement. This intent is evident elsewhere in the SAT Act. For example, s 9(b) makes it one of the main objectives of the Tribunal to act as speedily and with as little formality and technicality as is practicable, and minimise the cost to parties. Section 52 encourages the use of compulsory conference as an alternative to a final adversarial hearing. Section 54 encourages mediation as an alternative to final adversarial hearing. Importantly, s 56 expressly deals with settlement and enables the Tribunal to make an order giving effect to a written settlement of the parties. In this statutory context then, the rules providing for the making and acceptance of the settlement offers and for the making of an order for costs in the event that a settlement offer is rejected, or at least setting out factors to be considered in relation to an application for an order for costs in some circumstances, are important.

60 On the other hand, as Leeming JA (Basten & Emmett JJA agreeing) observed in Tempe Recreation (D.500215 and D.1000502) Reserve Trust v Sydney Water Corporation:[42]

The ordinary rule that costs follow the event, which underlies the making and acceptance of offers of compromise in most proceedings, does not apply. Instead, an applicant will have been dispossessed of an interest in land, and ordinarily, if he, she or it acts reasonably, is entitled to a favourable costs order. Because the starting point is different, it is necessary to consider whether a different approach ought to be taken to effectuate the purpose of an offer of compromise. For it would distort the ordinary operation of offers of compromise to permit the acquiring authority to make a low offer of compromise and cause the applicant to have to run the risk of a large adverse costs order, especially where as here there was essentially a binary issue as to construction.

61 It follows from the foregoing that where, in proceedings of the present kind commenced by a landowner, a preliminary issue is raised for determination upon which the responsible authority succeeds, there remains no scope for the application of the rule in ordinary litigation that costs follow the event. Any question of costs in that circumstance would involve a consideration of the nature of the preliminary issue, the applicant's conduct, and all the circumstances of the particular case.

62 The above observations are not intended to provide an exhaustive statement of the considerations which should, or may, or may not, be taken into account under s 87(2) of the SAT Act in proceedings commenced by a landowner in the Tribunal pursuant to s 188 of the PD Act. However, they are sufficient to indicate that it would be wrong to conclude that in the ordinary course the discretion should be exercised so as to require a landowner to pay the costs of the responsible authority if it does not establish a value in excess of an amount previously offered by the responsible authority. Insofar as the observations of Barker J in Clifford[43] might suggest to the contrary, they should not, in my respectful view, be accepted.

63 That is not to say, however, that I am suggesting that the result in Clifford was incorrect. In that case, there was a claim for compensation following the taking of a private right of way for the purpose of creating an under-width public road. At the hearing, the applicant claimed a total in excess of $1,450,000, including interest. In the event, the Tribunal assessed compensation in the sum of $3,250 which, with interest, was a sum less than $4,500 in total. The Shire had made, over a considerable period of time, a series of escalating offers culminating in an offer to settle the proceedings for $130,000, including costs, all of which were rejected.

64 Finally, the Tribunal may order costs under s 87(2) against an applicant who withdraws its proceedings in accordance with s 46 of the SAT Act. That is evident from the width of the language in s 87(2) and is implicit from the power conferred by s 88 of the SAT Act. Read as a whole, s 88 contemplates, relevantly, that even costs, other than the costs of the party, may be ordered in the Tribunal's original jurisdiction where an order for withdrawal could be made under s 46. It is implicit in that event that costs may be ordered in favour of a party under s 87(2). Section 88 also by necessary implication indicates that in its original jurisdiction, in an application for costs against a party, conduct of the kind referred to in s 46(3), s 47 and s 48 of the SAT Act will be relevant to the Tribunal's exercise of discretion under s 87(2).

65 However, even in a jurisdiction in which the general rule is that costs follow the event, the withdrawal of proceedings by leave does not automatically attract a costs order in favour of the party against whom the proceedings are withdrawn.[44] Section 46 of the SAT Act evinces no presumption that a withdrawing party should pay the other party's costs. Rather the presumptive position under s 87(1) applies unless the other party can establish that the discretion to award costs under s 87(2) should be exercised in its favour. There is no onus on the withdrawing party to show why it should not pay the other party's costs. All the circumstances would need to be considered in light of the considerations referred to above.

66 The question of law identified by senior counsel for WAPC cannot be answered affirmatively. The decision reached by the judge not to order costs in favour of WAPC was not a decision which was so unreasonable that no reasonable Tribunal could have come to that conclusion. It was open to the primary judge not to order costs against the landowner in this case where the landowner had chosen to withdraw its proceedings rather than effectively carry the burden of conducting a test case on a novel point of statutory construction.

67 In relation to the four submissions advanced by WAPC referred to in [44] above, the following observations may be made.

68 As to the first argument, the judge did not confine his consideration to the question of whether the discontinuance occurred late in the proceedings. He had regard, relevantly, to the presumptive position that each party should bear its own costs. He also had regard, properly, to whether there was something particularly in the conduct, 'such as the lateness in Westbourne [sic - Winterbourn]' (emphasis added), which would make it fair and reasonable to order costs in favour of WAPC. His Honour was not satisfied that Questdale's conduct in all the circumstances would justify an order for costs against it.

69 As to the second argument, it is not clear what his Honour meant by 'cost shifting'. There was no relevant sense in which costs would be 'shifted' from Questdale as a result of the discontinuance. Questdale would bear its own costs upon withdrawal and WAPC would bear its own costs unless it could establish grounds for the exercise of discretion in its favour under s 87(2). Insofar as WAPC's costs reflected work done in identifying, formulating and developing the preliminary question of law, the work could presumably be utilised, at least in part, in the other cases in which WAPC was involved in which the same point arose. No 'shifting' would be involved if s 87(1) operated without further orders. To the extent that the judge erred in considering that the withdrawal effected a 'shift' of costs from Questdale to either WAPC or other parties, his Honour was in error. However, it is not material in the sense that the judge's overall conclusion could only have been reinforced if the error had not been made. Although his Honour also appears to have erred in this context by describing costs as a 'penalty' which may be 'imposed', when costs are wholly compensatory, as discussed in [51] above, that is not the subject of any complaint by WAPC, and is in any event not a material error.

70 WAPC's third argument discloses no material error by the judge. Although perhaps rather obliquely expressed, on the proper construction of the extempore reasons, his Honour appears effectively to be saying that it is implicit in the legislative purpose of s 87(1) of the SAT Act that parties should not be discouraged, by the prospect of adverse costs orders, from withdrawing proceedings where it is reasonable in all the circumstances to do so. There is no error in that observation.

71 WAPC's fourth argument is effectively an amalgam of the first three. For the reasons given above, it has no merit.

72 As to the fifth matter raised by WAPC (see [45] above) the document in question (WAPC's mediation statement dated 28 February 2014) was not included in the appeal papers before this court.[45] It is not clear on what basis the mediation statement would be admissible for present purposes (see s 55 of the SAT Act), but assuming that it set out WAPC's position on the proper construction of s 188(1)(b) of the PD Act, the fifth point has no merit. First, the question of whether there was any delay is a question of fact. Secondly, if there were found to be delay, whether its nature and magnitude justified an order for costs in all the circumstances, were matters for evaluation by the Tribunal, and to be given such weight as the Tribunal considered appropriate. A question of law is not raised by this complaint, but even if it were, no material error has been established. The purpose of a mediation, by virtue of s 54(4) of the SAT Act is to 'achieve the resolution of the matters by a settlement between the parties'. It is to be inferred that WAPC's disclosure in February 2014 of its position on statutory construction was designed to inform Questdale of its approach to settlement. On the events deposed to by Mr Willey on behalf of WAPC referred to in [16] - [22] above, there were two mediation conferences, one in April 2014 and the other in August 2014. It was not until 8 September 2014, after the mediations had failed, that WAPC identified the point of statutory construction as an issue suitable for preliminary determination. On Mr Willey's evidence, it was open to the judge to infer that there had been no relevant delay, or at least none of the kind which would warrant an order for costs against Questdale.

73 No question of law of arguable merit has been raised by WAPC.

74 Leave to appeal should be refused and the appeal should be dismissed.

75 CORBOY J: I agree with Murphy JA. I also agree with all of the observations made by the Chief Justice.

[1] The appeal lies to the Court of Appeal if the decision was made by a judicial member or a Tribunal constituted by members who include a judicial member, and in all other cases lies to the General Division of the Supreme Court.

[3] SAT Act, s 105(2), except for the particular class of decisions specified in s 105(13).

[4] In all cases except for the specific class identified in s 105(13).

[5] Paridis v Settlement Agents Supervisory Board [2007] WASCA 97; (2007) 33 WAR 361 [16] - [18] (Buss JA, Wheeler & Pullin JJA agreeing).

[6] Winterbourn and Western Australian Planning Commission [2013] WASAT 72.

[7] Clifford and Shire of Busselton [2007] WASAT 89 (S); (2007) 52 SR (WA) 58.

[9] State Administrative Tribunal Rules 2004 (WA) r 42.

[10] The history is essentially derived from the affidavit of Mr S Willey dated 17 November 2014, sworn on behalf of WAPC in the primary proceedings (GB 24 - 169).

[11] Questdale's submissions, 18 July 2014, par 3.2, GB 153.

[12] WAPC's statement of facts, issues and contentions, 15August 2014, pars 17 - 20, GB 157.

[13] Winterbourn and Western Australian Planning Commission [2013] WASAT 72.

[14] Clifford and Shire of Busselton [2007] WASAT 89 (S); (2007) 52 SR (WA) 58.

[15] SAT extempore reasons ts 7, 28/01/15, GB 8.

[16] SAT extempore reasons ts 4 - 6, 28/01/15, GB 5 - 7.

[17] Lourey v Legal Profession Complaints Committee [2012] WASCA 112 [27]; Chief Executive Officer, Department for Child Protection v Hardingham [2011] WASCA 262; (2011) 214 A Crim R 259 [43] - [44]; Commissioner for Consumer Protection v Carey [2014] WASCA 7 [67] - [72].

[19] Associated Provincial Picture Houses Limited v Wednesbury Corporation [1947] EWCA Civ 1; [1948] 1 KB 223.

[20] Minister for Immigration and Multicultural Affairs v Eshetu [1999] HCA 21; (1999) 197 CLR 611 [44]; Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme [2003] HCA 8; (2003) 216 CLR 212 [30]; Minister for Immigration and Citizenship v Li [2013] HCA 18; (2013) 249 CLR 332 [28] (French CJ); [106] - [108] (Gageler J); cf [66] - [76] (Hayne, Kiefel & Bell JJ).

[21] In this regard, WAPC referred to the discussion of procedural fairness in McKay v Commissioner of Main Roads [2013] WASCA 135 [157].

[23] SAT argument ts 7, GB 203, read with SAT extempore reasons ts 6, 28/01/15, GB 7.

[24] Section 17 - s 31 of the SAT Act.

[26] Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24, 39 - 40.

[27] Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 [22].

[28] Cf Land and Environment Court Rules 1996 (NSW) pt 16 r 4, referred to in Port Stephens Council v Sansom [2007] NSWCA 299; (2007) 156 LGERA 125 [9]. That rule has since been replaced Land and Environment Court Rules 2007 (NSW) pt 3 r 7.

[30] Ohn v Walton (1995) 36 NSWLR 77, 79; Port Stephens Council v Sansom [49].

[31] Port Stephens Council v Sansom [50].

[32] Cf Miwa Pty Ltd v Siantan Properties Pte Ltd [No 2] [2011] NSWCA 344 [16].

[33] Compare s 223(9) of the Land Administration Act 1997 (WA) which provides that, in an action for compensation in a court, the 'costs of the action are at the discretion of the court'.

[34] Banno v Commonwealth of Australia (1993) 45 FCR 32, 51; Minister for the Environment v Florence (1979) 21 SASR 108, 134 - 135; Pastrello v Roads and Traffic Authority of New South Wales [2000] NSWLEC 209; (2000) 110 LGERA 223 [17]; AMP Capital Investors Ltd v Transport Infrastructure Development Corporation [No 3] [2007] NSWLEC 724 [19] (affirmed on appeal, AMP Capital Investors Ltd v Transport Infrastructure Development Corporation [2008] NSWCA 325; (2008) 163 LGERA 245 [101] - [105]); Brock v Roads and Maritime Services (formerly Roads and Traffic Authority of NSW) [No 3] [2012] NSWCA 404; (2012) 191 LGERA 267 [81].

[36] Port Stephens Council v Sansom [73].

[37] The exercise of discretion under s 87(2) in relation to the withdrawal of proceedings is further discussed later in these reasons.

[40] Adopting and adapting the language of Wells J in Florence (134).

[42] Tempe Recreation (D.500215 and D.1000502) Reserve Trust v Sydney Water Corporation [2014] NSWCA 437; (2014) 88 NSWLR 449 [103].

[44] IBN Corporation Pty Ltd v Banjyma Aboriginal Corporation [2009] WASC 279 [15].