The application for costs by Viva Energy Australia is refused.
No order as to costs.
[2]
This proceeding is an application under section 77 of the Planning and Environment Act 1987 to review the council's decision to refuse to grant a permit to use and develop the subject land for the purposes of a two storey child care centre.
An earlier application for review by the applicant, Wilcon Projects, against the council's refusal for a similar proposal for a child care centre[1] resulted in the Tribunal affirming the decision of the responsible authority and directing that no permit issue (Wilcon Projects No 1).
Parties to the proceeding in Wilcon Projects No 1 included respondents in the present proceeding, including Viva Energy Australia. Viva Energy operates a fuel terminal in close proximity to the subject land, which is a Major Hazard Facility (MHF). It is a major supplier of Melbourne's day to day fuel consumption including aviation fuel for the airport. One of the key reasons for refusing to grant a permit in the Tribunal's decision in was the risk associated with the proximity of the Viva Energy fuel terminal to the subject land in the context of its use for a child care centre.
Wilcon Projects No 1
Viva Energy was also a party to the present proceeding. In its statement of grounds it raised similar issues to its grounds in Wilcon Projects No 1 relating to risk associated with the proximity of a MFH close to a sensitive use such as a child care centre.
The following procedural orders were made in the present proceeding:
Initiating order dated 29 December 2017 listed the proceeding for hearing on 21 May 2018 for 2 days; a compulsory conference on 11 April 2018; and a practice day hearing on 23 February 2018.
Following the practice day hearing, an order dated 28 February 2018 listed a hearing on 25 June 2018 for 5 days before 2 members; and a compulsory conference on 11 April 2018. A series of additional procedural orders were made covering further service of the application; exchange of witness material; and directing a meeting of expert witnesses on risk assessment by not later than 31 May 2018.
A compulsory conference was held on 11 April 2018 and a second compulsory conference was held on 23 April 2018. The proceeding did not resolve at the compulsory conference. By order dated 24 April 2018, proceeding was listed for hearing on 25 June 2018 for five days before two members. An administrative mention was listed on 8 May 2018.
On 8 May 2018, solicitors for the applicant made an application for leave to withdraw the proceeding. The reason for the application was that: "the Permit Applicant no longer wishes to pursue the development as proposed in the application."
By order dated 14 May 2018, the Tribunal made the following order:
By order dated 19 June 2018, the Tribunal directed that any party that wishes to make an application for costs must file and serve such application and supporting submissions by not later than 11 July 2018. Any responses to the application for costs must be filed and served by no later than 27 July 2018.
The only application for costs in response to the Tribunal's order is by Viva Energy. It has applied for costs in the sum of $50,262.32 on the basis of indemnity costs. Alternatively, it claims costs and disbursements on a standard basis in the sum of $41,820.81.
The essence of Viva Energy's claim for costs is that:
Viva has incurred loss in responding to a repeat appeal made by the applicant, Wilcon Projects, notwithstanding the loss of its first application in Wilcon Projects No 1, which was for a development in substantially the same form, location and nature to this repeat appeal.
In the original proceeding, the Tribunal upheld the decision of the council to refuse to grant a permit to the applicant.
In the repeat application for a permit, the council was of the opinion that the redeveloped proposed development still did not sufficiently address the concerns of the original Tribunal decision in Wilcon Projects No 1.
In the repeat appeal, the concerns of the original Tribunal decision were still unaddressed. Therefore, the repeat appeal lacked merit.
- The reasons stated by the Tribunal in the first application is Wilcon Projects No 1;
- The commencement of the repeat appeal in circumstances which were not substantially different from those advanced in the first application;
- The commencement and continuation of two compulsory conferences;
- The unexplained withdrawal of the repeat appeal approximately one month before the time fixed for an allocated five day hearing of the proceeding.
The costs application by Viva Energy is opposed by the applicant, Wilcon Projects. It disputes the basis for the costs claim, in particular that the two permit applications were substantially the same and that the withdrawal of the repeat appeal was unexplained.
With respect to the contention that the two applications are the same, it submits that the proposed development is significantly different in several key aspects. To understand the significance of the changes, it is relevant to refer to the Tribunal decision in Wilcon Projects No 1 and the substantive reasons as to why it was unsuccessful. In essence, it was unsuccessful for two key reasons:
Access from Steele Street was considered unsatisfactory; and
The Tribunal did not accept that the risk of a Vapour Cloud Explosion (VCE) was at an acceptable level.
The current proceeding (the repeat appeal) sought to address these two substantive matters in the following ways:
In relation to the issue of access, the repeat appeal proposed access from Melbourne Road - a position supported by Vic Roads but not by the council.
In relation to the issue of the VCE explosion, the applicant redesigned the building and the location of the play areas in a way that its expert consultant on risk found to be acceptable.
However, subsequent to the lodgement of the application for review at VCAT for the repeat appeal, the applicant became aware that potentially covering the outdoor play area on the first level as proposed to deal with the VCE explosion risk might not satisfy the requirements of certain regulations under the Children's Services Regulations 2009. Satisfactory compliance with these regulations are required to obtain a licence to operate a child care centre. The applicant made the decision not to proceed with the permit application because even if it was successful, it would not be able to obtain a licence to operate the child care centre under the regulations. It sought to explore with the council and Viva Energy alternative land uses as part of the discussions at the two compulsory conferences, but no resolution could be reached. In deciding to withdraw the application, the applicant submitted that it had saved all parties, including Viva Energy, costs associated with a five day hearing.
(2) If an applicant withdraws an application or referral -
[5]
(b) the Tribunal may make an order that the applicant pay all, or any part of, the costs of the other parties to the proceeding; ...
[6]
Section 74(2)(b) is a separate power to order costs on a withdrawal of a proceeding. There is no rule that costs lie where they fall unless the Tribunal considers it fair to order otherwise, such as applies under section 109 of the Victorian Civil and Administrative Tribunal Act 1998.[2] The Tribunal has an unfettered and broad discretion as to costs under section 74(2)(b).[3] A decision as to costs must depend on all the circumstances of the case. The power to award costs under section 74(2)(b) is governed by the overarching obligation on the Tribunal to act fairly and according to the substantial merits of the case, imposed by section 97 of the Act. For this reason, the Tribunal has held that the issue of costs under section 74(2)(b) must be considered on a case by case basis.[4]
In the present case, I do not consider that it would be fair to make an award of costs against Wilcon Projects. In the Planning and Environment List, it is recognised that permit applicants may make multiple applications for a permit. Whilst it is relevant to consider how previous applications were decided, each application must be considered on its own merits and in the context of the planning controls and policy framework at the date of the decision.
I am satisfied that whilst the two permit applications in the present case were very similar, the second application was different in two significant respects having regard to the Tribunal's reasons in Wilcon Projects No 1. I am satisfied that the differences in terms of access and relocation and redesign of the play areas were genuine attempts to address the shortcomings identified by the Tribunal in Wilcon Projects No 1. I cannot speculate about whether they would have been sufficiently satisfactory to result in the grant of a permit. However, I cannot support the submission by Viva Energy that the repeat appeal was substantially devoid of any merit.
I am satisfied that there was a plausible reason for the applicant to withdraw the proceeding without the expense of going to a hearing in circumstances where, it says, even if a permit was granted it was unlikely to secure the necessary licence to operate the child care centre under the Children's Services Regulations 2009.
Whilst Viva Energy may have incurred costs by its participation as a party in this proceeding, in my view, it cannot complain about the outcome. It opposed the grant of a permit. As a result of the withdrawal, the outcome is that no permit is issued. This outcome has been achieved without the need for Viva Energy to incur the costs associated with a potential five day hearing. Therefore, I cannot see that the withdrawal has prejudiced Viva Energy or that there are any circumstances which will make it fair to make an award of costs in its favour. Viva Energy has chosen to participate in this proceeding as a party to protect its interests. It has been successful. If the case had gone to a hearing, there would have been no presumption that it would have been entitled to an award of costs under section 109, especially having regard to sub-section (1), namely that the starting point in any consideration of costs is that each party in a proceeding is to bear their own costs. I consider, it would be inappropriate for the Tribunal to use the power to award costs to discourage permit applicants from lodging multiple permit applications in an endeavour to rectify shortcomings associated with an earlier, unsuccessful proposal. In my view, an award of costs in the present case would be tantamount to punishing the applicant in its efforts to secure a permit by amending its proposal, notwithstanding the continued opposition by Viva Energy to any child care proposal on the land.
For these reasons, I am not satisfied that it would be appropriate or fair to make an award of costs against Wilcon Projects in this proceeding under section 74(2)(b)