Wren Investments Pty Ltd v Hunter

Land and Environment Court (NSW)|2011-07-12|Before: Pepper J

Introduction 1This is an application filed by Wren Investments Pty Ltd ("Wren") on 1 July 2011 for expedition of Class 3 proceedings (filed on 20 June 2011), together with consequential timetabling orders. 2The application is opposed by the respondents, Mr Laurence Hunter and Ms Anne Hunter ("the Hunters"). 3In support of the application Wren relied on an affidavit of Mr Bruce Wren sworn 1 July 2011. Mr Wren is a director of Wren. 4The respondents relied on an affidavit of Mr Russell Byrnes sworn 11 July 2011. Mr Byrnes is the solicitor acting on behalf of the Hunters. He was instructed to act in the matter on 4 July 2011. 5For the reasons given below I have determined, albeit reluctantly, that expedition should be granted.

Procedural History Giving Rise to the Application for Expedition 6Wren is the owner of land described as 401A-403 Mowbray Road, Chatswood ("the land"). 7Wren originally sought an easement from the Hunters in 2002, but this was rejected. 8In 2006 Wren submitted a development application to Willoughby City Council ("the council") for the demolition of two existing dwellings on the land and the construction of residential housing for aged persons or persons with a disability. 9The council refused the development application and a subsequent Class 1 appeal was commenced in this Court. The matter was heard before Brown C who upheld the appeal on 23 August 2006, subject to conditions of consent ("the consent"). One of these conditions was a deferred commencement condition which stated the following: Engineering Requirements The proposal must meet with the following engineering requirements: (1) Documentary Evidence of Drainage Easement The Applicant shall obtain and register in the Department of Lands and Property Information a drainage easement from one of its adjoining downstream properties to convey stormwater from the development to Council's underground system in Sharland Avenue, Chatswood . (Reason: Prevention of nuisance flooding) 10The consent was modified on 9 October 2008, by fixing an agreed date of lapsing, namely 23 August 2011. 11On 5 November 2010 Wren offered to acquire the easement from the Hunters. This offer was rejected on 17 November 2010. 12Wren then proceeded to wait three years before opting to commence further proceedings by way of s 96 modification application to seek a variation of the conditions of consent to remove the requirement for an easement. The matter was again heard by Brown C on 28 and 29 April 2011. On 10 May 2011 the Commissioner dismissed an appeal against the refusal by the council to modify the consent. 13In so doing, the Commissioner accepted that an easement would be reasonably necessary for the effective use or development of the benefited land ( Wren Investments Pty Ltd v Willoughby City Council [2011] NSWLEC 1167 at [18]). The Commissioner found that an easement would be the most effective method of providing for the widely accepted engineering practice of gravity disposal of the storm water (at [17]-[18]). 14The Commissioner made two further observations that are worth repeating in the context of this application: (a) first, the Commissioner found that he was not satisfied that full and proper negotiations had taken place with the owners of the downstream properties. In particular, there was some doubt whether the offers of compensation made for the acquisition of the easement were realistic in the absence of any formal valuation (at [20]); and (b) second, there was no criticism made of any of the downstream owners in their discussions with Wren. The owners had no obligation to agree to the imposition of an easement over their land (at [21]). 15The Commissioner went onto state that the onus rested on Wren to come to an arrangement with these owners, including reasonable compensation. The Commissioner emphasised that "the need for an easement was clearly known by the applicant long before the approval of the development application, based on the chronology of correspondence with downstream property owners" (at [21]). 16Astonishingly, over a month was permitted to pass before Wren filed, on 20 June 2011, a Class 3 application in the Court seeking an order for an easement to be granted in its favour over the land. An application for expedition was did not accompany the Class 3 application and no evidence in support of the order for the grant of an easement was filed at the time. 17On 28 June 2011 a further offer to acquire the easement was made by Wren to the Hunters. This offer was rejected, although it is not known when. 18It was not until 1 July 2011 that Wren filed a notice of motion seeking orders for expedition. This was less than two months prior to the expiration of the consent. 19When the application came before the Court on 8 July 2011, Mr Webber, the solicitor who normally has day-to-day carriage of the matter on behalf of Wren, appeared and mentioned the matter on behalf of Mr Byrnes. A one week adjournment of the hearing of the notice of motion was sought and granted while the parties engaged in negotiations. As a result, more time was lost.

Evidence of Wren 20Mr Wren deposed that the deferred commencement condition must be satisfied by the registration of an easement over the downstream property and the presentation to the council of confirmation of such registration by 16 August 2011. If not, the consent will lapse on 23 August 2011. It was for this reason that expedition is sought. 21Accordingly, Wren needs to, in order to preserve the validity of the consent, obtain an order from the Court granting the required easement over the Hunters' land, lodge and register the easement with the Land and Property Information Service and undertake sufficient physical works on the site to secure the consent before 23 August 2011. Thus, it was Mr Wren's evidence that "the applicant would need determination in its favour from the Court no later than the end of July 2011". Given the length of time that Wren knew that it required an easement and the tardiness of its application to this Court for relief in that regard and its application for expedition, this statement was, in my opinion, quite extraordinary. 22The only explanation given by Mr Wren for the delay in the filing of both the application and the notice of motion seeking expedition was that Wren had been in negotiations with the Hunters and had been reluctant to escalate the proceedings by way of an application for expedition in order to avoid "a hardening of positions and the expenditure of further costs to both parties". 23Mr Wren indicated that Wren had engaged the following experts for the purpose of obtaining the easement: (i) Mr Chris McMurray of Sydney Suburban Property Valuation. Mr McMurray has undertaken a valuation of the easement over the Respondent's property and a copy of his report will be forwarded to the Respondent within the next 7 days. (ii) Mr Ben Carruthers of Eclipse, Consulting Engineers. Mr Carruthers has drawn up the engineering details and plans of the proposed easement. These documents have been provided to the Respondent. (iii) Ms Catriona Mackenzie, a consulting arboriculturist and horticulturist. Ms Mackenzie will provide a letter of her opinion in relation to a tree on the Respondent's property within the next 7 days. (iv) Mr John Caddey, a surveyor who has acted for the Respondent, has been engaged to provide further survey details of the Council road reserve adjacent to the Respondent's property. Prior to this I have engaged JB White Surveyors who have prepared a draft s88B instrument. (iv) I have also engaged Ms Larissa Brennan of LJB Urban Planning. Ms Brennan is a consultant town planner who has had a number of meetings with the Respondent. 24Mr Patterson, who appeared in lieu of Mr Webber for Wren, indicated that with the exception of a report from Ms Larissa Brennan, all of the expert reports relied upon by Wren had been served on the Hunters on 4 July 2011. 25With respect to Ms Brennan's expert evidence, Mr Patterson was of the opinion that her evidence would be directed only to the discrete issue of the effect of the easement on the potential subdivision of the Hunters' property and that her expert evidence could be furnished to the Court by way of joint report with the Hunters' cognate expert. 26The only remaining evidence, the Court was told, that was contemplated to be served by Wren was an affidavit pursuant to s 88K(2)(c) of the Conveyancing Act 1919 demonstrating the attempts made to date by Wren to negotiate with the Hunters, which would be largely based on existing documents with which the Hunters were familiar (comprising of correspondence passing between the parties), the contents of which would be uncontroversial. 27Finally, Mr Patterson indicated to the Court that because the development consent granted was in respect of both the demolition and erection of buildings, demolition alone would constitute sufficient physical works on the site to secure the commencement of the consent. That is to say, no construction certificate would be required.

The Evidence of the Hunters 28On behalf of the Hunters, Mr Byrne deposed to the prejudice that would be suffered by the Hunters if expedition were granted. Notwithstanding this prejudice, Mr Byrne had nevertheless attempted to secure experts willing, in the truncated time available to them, to provide evidence on behalf of the Hunters. However, due to the short notice and the fact that it is currently school holidays, it was Mr Byrne's evidence that, and despite many attempts, he had been unable to obtain a barrister available to take the brief in the matter for a hearing within the timeframe envisaged by Wren. This is unsurprising. 29But, at today's hearing Mr Byrnes indicated to the Court that counsel was available in the week commencing 1 August 2011. 30Mr Byrnes also indicated that although he has now retained a valuer, namely, Mr Wayne Wotton, Mr Wotton has informed him that his report will take approximately two weeks once Mr Wotton gets all of the information he needs, but that he cannot guarantee that it will be ready before the end of July. Mr Byrnes has now sent to Mr Wotton all of the relevant material received to date from the Hunters and Mr Wotton has arranged to attend the site and to undertake an inspection this week. 31Mr Byrne has also been able to secure the services of Mr Michael Neustein, a town planner, to advise and report in the matter. Mr Neustein has advised Mr Byrnes that, doing his best, he may be able to complete the report towards the end of the month but, again, this cannot be guaranteed. 32According to Mr Byrnes, the town planning evidence is equally important as the valuation evidence. This is because the Hunters' property consists of two separate lots, which presently cannot be separately built upon. The land can be re-subdivided to allow for two separate residential lots, but the re-subdivision would involve the use of the northern boundary, over which Wren seeks the easement. Notwithstanding the easement, re-subdivision may be possible, but will result in a battleaxe lot, which would clearly affect the Hunters' future use of the property. 33Notwithstanding the engagement of the experts referred to above, Mr Byrnes nevertheless submits that it will not be possible to prepare the matter properly on behalf of the Hunters within the timeframe contemplated by Wren. However, Mr Byrnes properly conceded that if the timetable was extended by one or two weeks, it would not be impossible to prepare for a final hearing. 34In addition, Mr Byrnes further stated that at this early stage of the proceedings he could not indicate to the Court with any confidence what the real issues in dispute in the proceedings would be or how long the hearing is likely to take.

Legal Principles Applicable to Expedition in this Court 35There is no specific power dealing with expedition in either the Civil Procedure Act 2005 ("CPA"), the Uniform Civil Procedure Rules 2005 ("UCPR") (other than in the Court of Appeal: see r 51.60 of the UCPR), the Land and Environment Court Act 1979 or the Land and Environment Court Rules 2007. It therefore appears that the power of this Court to grant expedition is found in s 61 of the CPA and r 2.1 of the UCPR. The former provision enables the Court to give such directions as it thinks fit for the speedy determination of the real issues between the parties to the proceedings, and the latter rule enables the Court, at any time, to give such directions and make such orders for the conduct of any proceedings as appear convenient for the just, quick and cheap disposal of the proceedings. Both compliment the provisions contained in ss 56-58 and ss 61-63 of the CPA. 36In Vaughan v Dawson [2005] NSWSC 33 Campbell J quoted (at [8]) the following passage from Greetings Oxford Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 (at 42-43 per Young J): 8 In Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 at 42- 43 Young J said: "...when considering whether to expedite proceedings in this Division there are at least six factors which are taken into account. These are: (1) Is this the appropriate Court for the litigation, in particular: (a) does the litigation fall into the work normally done by this Court; and (b) is there a sufficient nexus with New South Wales. (2) Is there a special factor involved which warrants expedition. Usually these factors will be: (a) the loss of witnesses if the case is not fixed at an early date; (b) matters of public importance; (c) that the subject matter of the litigation will be lost if it is not heard quickly; (d) that the litigation to date has been delayed through no fault of the applicant; (e) that the applicant is suffering hardship not caused through his own fault; (f) hat there is self-induced hardship (including those cases where corporate bodies fix a meeting date in the near future and then expect the Court to displace all other matters to hear their dispute before that date); (g) the nature of the case (for example, ejectment, child custody); and (h) that there are large sums of money involved. There may, of course, be other matters which can count as special factors, but the list that I have given is what occurs in the usual case. The health or age of parties or witnesses may, of course, come under (a), (c) or (e) or all of those headings. (3) Have the parties proceeded up to the date of the hearing of the motion for expedition with due speed? (4) Are the parties willing if expedition is granted to do all in their power to abridge the hearing time including joining in an agreed bundle of documents, preparing statements of witnesses, filing lists of objections to affidavits, making admissions of matters not really in dispute and restraining wide-ranging cross-examination. Of course there will always be cases where one party's interests are to delay resolution of the dispute as much as possible. Such cases can usually be recognised and special procedures adopted. Then there are two factors dealing with the exigencies of the list, viz: (5) Any application for expedition must be judged in the light of the number of other cases of equal or higher priority that also seek an expedited hearing. (6) Any "right" to expedition is a right to have the case fixed on one occasion. If, after a date has been fixed, it has to be vacated, it is difficult indeed to justify again expediting the proceedings: Ron Hodgson Cabramatta Pty Ltd v Wewoka Pty Ltd t/as B P Cabramatta Motors (Waddell CJ in Equity, 30 March 1989, unreported). The question here is whether there is a seventh guideline, namely, that one should not expedite a case where the chances of the applicant for expedition securing what it wants in the proceedings are not high. This point arises because the defendant submits that because of the matters I have already canvassed, the chances of the plaintiff obtaining equitable relief must, according to the defendant, be slim. I do not think that the Court, ought in an application for expedition, to make an assessment of the applicant's chances of success. However, I do agree that there is a seventh guideline, namely, that the Court should not expedite a case if it considers that in all the circumstances the chances of the applicant obtaining what it seeks in the litigation cannot be put as higher than speculative." 37It was the opinion of Campbell J that these principles remained applicable (at [8]). I agree with his Honour's assessment. 38Applying these principles to the present motion results in the following conclusions: (a) there is no doubt that if expedition is not granted, the subject matter of the Class 3 litigation will be lost by reason of the lapsing of the consent; (b) if the consent lapses, it is not known to what extent Wren will suffer loss, but it may be assumed that any monies it has expended to date in obtaining the development consent will be wasted; (c) the present position that Wren finds itself in is entirely of its own making. No cogent explanation has been provided to the Court as to why Wren delayed the filing of these Class 3 proceedings until late June 2011 or why it delayed the filing of notice of motion for its expedition until two weeks after that date. The attempts to achieve resolution of the impasse by way of negotiation with the Hunters in order to preserve costs, however laudable, provide an insufficient explanation for the delay in light of the looming 23 August 2011 date; (d) it follows that it cannot be said that Wren has proceeded up to the date of the hearing of the motion for expedition with "due speed"; (e) as a consequence, if expedition is granted the Hunters will be subjected to prejudice; (f) having said this, both parties are willing, if expedition is granted, to do all in their power to reach the time required to prepare the matter for hearing; (g) because what is sought by Wren is an order for an easement granted in its favour, the proceedings can only be finally determined by a judge of this Court, and not a commissioner (s 40 of the Land and Environment Court Act 1979). This restriction acts as a further limitation on the capacity of the Court to grant expedition. The interests of the efficient administration of the Court's business is a consideration which must be taken into account in determining whether or not to expedite the proceedings ( Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175); but (h) it cannot be said that in all circumstances of the Class 3 proceedings that the chances of Wren obtaining what it seeks are "speculative" in light of the comments made by Brown C in the Wren decision referred to above. 39This application is extremely finely balanced. I accept the submissions of the Hunters that if expedition is granted it will cause them difficulty in preparing for a final hearing. But I do not accept, at least not at this stage on the material before me, that with an appropriate timetable it will be impossible for them to prepare for an expedited hearing. 40I also accept that the necessity for this application has been born out of the manifest inaction of Wren given the immediacy of the expiration of the consent. It my opinion, it beggars belief that the Class 3 application was not filed prior to 20 June 2011 given that the consent lapses on 23 August 2011. The explanation provided by Wren, namely, that it wished to avoid incurring unnecessary expense consequential upon the commencement of proceedings is, I reiterate, wholly inadequate in the circumstances. 41Against this, the Court is acutely aware that once the consent, a valuable commodity, lapses it cannot be revived and the application process will need to be recommenced if the development is to be pursued. 42It is for this latter reason, together with my view that the likely prejudice suffered by the Hunters in having to prepare for a final hearing even at unreasonably short notice is not insurmountable, that inclines me to order expedition. 43Having said this, it is simply not possible both from the perspective of the Hunters and the conduct of the Court's business to accede to the timetable urged upon the Court by Wren. In stating this I am acutely aware that this may result in Wren being unable to complete the necessary steps to lodge and register the easement in time to avoid the consent lapsing. But to truncate the preparation for the hearing any further would not facilitate the overriding purpose of the just, quick and cheap resolution of the real issues in dispute in the proceedings (s 56 of the CPA and see also ss 58-60 of that Act).

Wren Must Pay Hunters' Costs 44Typically, Wren having been successful in its application, albeit by the slenderest of margins, costs would follow the event. In the context of the present application, however, such an order would be grossly unfair. No doubt in recognition of this, Wren submitted that the costs of the motion should be costs in the cause. 45I do not agree. In my view, had Wren acted with all due haste instead of engaging in all due delay in bringing the Class 3 proceedings and this application for expedition, neither today's application nor the attendant legal costs incurred by the Hunters to meet it would have been necessary. 46As stated above, the predicament in which Wren is now placed, is entirely one of its own making. In such circumstances it would not be appropriate for the Hutners to pay, either now or potentially at some point in the future, any part of Wren's costs of this application. On the contrary, in light of the cost consequences of the dilatory conduct of Wren to the Hunters, it is appropriate that the Hunters be compensated for the legal costs they have been forced to incur as a result of the conduct of today's application. In no way could it be said that in the circumstances their opposition to the motion was anything other than entirely reasonable and appropriate.

Orders 47The orders of the Court are as follows: (1) expedition is granted to these proceedings; (2) the applicant is to file and serve all remaining evidence upon which it intends to rely by 15 July 2011, with the exception of the joint evidence by Ms Larissa Brennan of LJB Urban Planning. Any further evidence may only be filed with leave of the Court; (3) the respondents are to file and serve any evidence upon which they intend to rely by 29 July 2011; (4) all joint expert reports, including the joint expert report by Ms Larissa Brennan, are to be filed and served by 2 August 2011; (5) the matter is listed for hearing on 4 and 5 August 2011, commencing on 4 August at 10.00 am; (6) the respondents are to serve in writing on the applicant a list of documents which they require to finalise its evidence by 14 July 2011; (7) the applicant is to provide copies of the documents requested to the respondents by no later than 18 July 2011; (8) the applicant is to pay the respondents' costs of the motion; and (9) liberty to restore on 24 hours' notice.

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