Mr Justin Foster of Counsel instructed by Maddocks Lawyers

Mr Griffin called Mr Con Bahramis, Project Architect and Supervisor, CBG Architects Pty Ltd to give evidence

1. The responsible authority applied for an enforcement order in respect of what it alleged was the unauthorised construction of a concrete ledge above the windows on the second storey of the building under construction on the subject land. The ledge protrudes some 400mm from the façade.
2. The substance of the application was resolved early in 2013 on the basis that the responsible authority granted secondary consent to amend the endorsed plans to include the as-constructed ledge wrapping around the building on Newry and Glass Streets. The structure is now lawfully approved (albeit post construction).
3. The issue of costs remains. The respondent permit holder, Newry Street Pty Ltd claims costs in the order of $10,000 in the proceeding and the respondent builder, Kubic Pty Ltd claims costs of approximately $7,000.[1] Key attendances relate to preparation for and appearances at the Practice Day Hearing as well as additional (unbilled costs) relating to the preparation of an affidavit by the project architect and supervisor as well as to this costs hearing.
4. The respondents claim that the proceeding was vexatious or, essentially, that it should never have been instituted since it was lacking in substance. They seek costs as a matter of 'fairness' in an attempt to reimburse them for a portion of their legal costs in defending the application.
5. The responsible authority strongly resisted the application for costs. It submitted that each party should bear its own costs consistent with the starting point in section 109 of the Victorian Civil and Administrative Tribunal Act 1998. It denied that the application was vexatious and submitted that there had been a clear breach of the planning scheme that justified instituting the proceeding.

1. Although now resolved, the substantive issues are relevant to the extent that they inform whether the proceeding was reasonably instituted and also the strength of the claims for each party as is a listed consideration in section 109(3)(c) of the Act.
2. This necessitates consideration of the set of plans that were endorsed under the relevant planning permit at the date the issue with the ledge arose.
3. These plans (Revision C set, endorsed on 22 July 2011) show two narrowly spaced horizontal lines above the second storey windows on both the Newry Street and Glass Street elevations with a strong shadow line beneath them. They fall short of extending to this corner of the building. However, the ledge is not shown on either the floor plans or the section plans.
4. On 11 September 2012 the responsible authority issued a Planning Infringement Notice in respect of the ledge, requiring its removal and the payment of a fine.
5. Mr Bahramis, the project architect and supervisor gave evidence that he attended the council offices frequently to speak with planning staff as issues emerged with the approved development. One of these occasions was on 14 September 2012 which led to him submitting Revision E plans on 17 September 2012 which included the full extent of the as-constructed ledge on the elevations, floor plans and sections. He sought approval by secondary consent on behalf of the permit holder.
6. This request was followed by a letter from the permit holder's solicitor to council's Manager of Statutory Planning on 27 September 2012 clarifying the permit holder's position.
7. The application for enforcement order was lodged on 15 October 2012. The responsible authority requested that the Tribunal deal with the application expeditiously since it was concerned that continuing construction may impact the extent of any remedial works.
8. The respondent's solicitor also confirmed his client's position by letter dated 31 October 2012 and requested the application be withdrawn at that stage.
9. For reasons that transpired[2], the request for consent for the ledge was re-lodged with the council on 23 October 2012 and was only finally determined a few weeks prior to this hearing. The application was listed for full hearing on 29 January 2013. I was advised that secondary consent was granted by the responsible authority for the ledge in its as-constructed form (properly documented) on 8 January 2013.

1. In my opinion, this is a difficult ground to substantiate especially in view of the case law tests established in Cabot v City of Keilor[3] and subsequently applied and expanded by divisions of this Tribunal. They would indicate that various kinds of improper motive may invoke this ground or an intention to embarrass/annoy, as well as a claim that was obviously untenable or manifestly groundless.
2. Mr Griffin on behalf of the respondents submitted that the trail of correspondence including the documented communications of council officers as well as its actions in pursuing the matter demonstrated that the application was vexatious. He alleged that there was most likely an underlying political agenda that precipitated the enforcement proceeding.
3. I accept that this site has some history, in that there was a pertinent review proceeding[4] and the council succeeded in an earlier enforcement proceeding at the Tribunal in 2011[5]. In the latter, the Tribunal ordered that three walls of the building had to be substantially reconstructed.
4. In reality, this factual background probably generated a heightened sense of concern or sensitivity about the construction of the building on the subject land in so far as the council was concerned about the potential for non-compliance with the endorsed plans and was aware of public interest in the development.[6] I speculate that this may have been one reason why the Director of Planning chose to make all decisions about the development personally, notwithstanding however minor they may have been in the overall scheme.[7]
5. Reflecting on the internal council correspondence, I consider that some references are most likely attributable to this general history. This includes comments by the Director of Planning that "the saga continues" and "the developer should try harder". It is obvious with the benefit of hindsight that these sorts of comments are undesirable and expose council to criticism.
6. Notwithstanding, I find that the material disclosed to date falls quite short of supporting a claim that the proceeding was vexatious as such. For a start, the material tendered does not explicitly or implicitly suggest that there was any political agenda behind the council's decisions in respect of the property. Neither does it indicate that the proceeding was brought for an improper purpose or was designed to embarrass, annoy or frustrate the respondents.
7. For the reasons I have documented below, I do not consider that the facts would warrant the council's position as being described as manifestly hopeless or obviously untenable, which would tend to indicate that there was no basis for the application in the first place.

On the balance of probabilities, was there an actionable breach of the endorsed plans? Are costs justified for any other reason?

1. I consider that the ledge was incompletely documented on the endorsed plans since it was not shown on the elevation plans and section plans as is accepted practice. I find that this was an omission on the part of the draftsman. [8] Objectively considered, I regard this as a discrepancy in the approved plans.
2. In my opinion, any planner acting reasonably and turning their mind to this part of the building on the elevation plans should have realised that the representation by the two lines depicted some form of structure, rather than simply decorative moulding given the thick shadow beneath it.
3. At the same time, in the absence of the structure being depicted on the sections or floor plans, it would not have been reasonably possible to speculate about the depth of this feature or to predict that it would wrap around the corner of the building rather than terminating short of the corner on both elevations.
4. On balance, at the time the application for enforcement order was lodged, the council and presumably its legal advisors were probably under a misapprehension that the ledge in its entirety was unauthorised and therefore sought its complete removal in the draft orders section of the form. In light of the above, I find this position difficult to substantiate.
5. In terms of process and timing, it is relevant that the permit holder sought the amendment of the endorsed plans to include the as-constructed ledge via the Revision E plans. Unfortunately, in an attempt to fast-track other amendments that were regarded by council officers as potentially less controversial, this part of the plans was deleted and only resubmitted as part of the Revision F plans on 23 October 2012.
6. Either way, the request for secondary consent was transparently 'on the table' before the application for enforcement order was lodged. It is also somewhat concerning that the application for enforcement order appears to have been lodged without any meaningful dialogue with the permit holder's representative, company directors or the directors of the building company.
7. For the record, I am less concerned that the proceeding was instituted while the review of the Planning Infringement Notice had only been resolved recently. These processes are not mutually exclusive and it is not uncommon for a council to make a judgement call to issue such a notice but then decide that a preferable avenue for resolution is via the Tribunal in addition to or as an alternative to the Magistrates' Court.
8. There was no suggestion that the non-compliance raised any safety concerns that may have justified urgent enforcement action or any public interest concerns or that it was precipitated by genuine local objection. This may have otherwise justified urgent action being taken even though the permit holder had sought permission to remedy the alleged breach.
9. It may also have been possible for the responsible authority (through its Building Department or by direct enquiry of the project architect/engineer) to identify early in the piece whether the structure was integral to the building or whether it could be separately modified if ultimately required, thereby reducing the perceived urgency.
10. I accept that the responsible authority has a duty to administer and enforce the planning scheme.[9] In the circumstances, I regard this akin to an obligation to at least investigate and pursue non-compliances with planning permits in a timely way; based on what can reasonably be known at the time; influenced by realistic pressures on council to use its resources in a measured way; and bearing in mind other legitimate processes to resolve the alleged noncompliance.
11. To suggest that the responsible authority had a quasi 'obligation' to institute this particular proceeding when it did is in my opinion taking a draconian approach to the broader duty, especially once a request had been made to reconcile the endorsed plans with the building under construction. Of itself, the latter process should have brought the issue to a head and enabled direct consideration of the planning merits of the feature in question.
12. In this combination of circumstances, I consider that it was premature for the responsible authority to have commenced the enforcement application. At best, it could have demonstrated that some detailing or structure was depicted on the endorsed plans but that its extent was unknown. At worst, the Tribunal may have found that the structure was authorised even though not fully documented, albeit the corner component which was not shown on any plans.
13. Overall, I find the action of the council in instituting and pursuing the proceeding until the substantive issue was finally resolved in January 2013 was heavy-handed.

What sum of costs would be appropriate on the facts before me?

1. In dealing with this particular issue, I am conscious that there are broader public policy issues at stake here. In general, councils should not feel that they are only entitled to commence an application for enforcement order where it has a 'bullet proof' case. This is one end of the spectrum.
2. Shifting towards the other end of the spectrum is a case such as this that has been brought on an inconclusive basis and where the permit holder had earlier sought permission for the as-constructed part of the development.[10] Also, in my opinion, the public interest argument that often gives rise to applications for enforcement order is not overly pressing on the facts.
3. As a matter of equity, once the discrepancy was identified, the respondents arguably did all that they could to regularise it.
4. In the circumstances before me, I consider that it is reasonable for some of the respondents' costs to be recouped from the responsible authority as a matter of fairness.
5. The fact remains that there was a discrepancy in the approved plans that arose due to an architect's omission to include the full extent of the ledge and also to properly document it on at least the floor plans. Therefore, the respondents could not have conclusively demonstrated that the as-constructed ledge was approved in its current form. This is a factor weighing against a full award of costs, even on a party-party basis.
6. Also, the need for a full hearing was alleviated by the ultimate approval of the current set of plans by secondary consent, benefitting the permit holder. However, this occurred some three weeks before the hearing. By then, it was reasonable for the respondents to have prepared affidavit material in support of their case.
7. On balance, I consider that the respondents should be entitled to an award of costs representing a proportion of their legal fees incurred in the proceeding at less than party-party costs, plus an additional approximated amount for:
   • the appearance and preparation for this costs hearing[11]; and
   • reasonable costs associated with the preparation of Mr Bahramis' affidavit and his appearance to give evidence at the hearing.[12]

I have made an order accordingly taking account of the timesheets tendered from the two solicitors' firms in respect of this proceeding.

[1] I was advised that there is a separate prosecution instituted in relation to the subject land and the issue of the ledge and that no costs claimed in the Tribunal proceeding arose from the related prosecution since a separate solicitor's file was used and the solicitor for Kubic Pty Ltd was not directly instructed in the prosecution matter.

[2] Including the giving of notice after obtaining legal advice.

[3] [1994] VicRp 14; [1994] 1 VR 220.

[4] The Crema Group v Yarra CC & Ors [2011] VCAT 199.

[5] Yarra CC v Newry Street Pty Ltd [2012] VCAT 357.

[6] The latter appears to have been the subject of email correspondence from council's Planning Director to his staff.

[7] Referencing internal emails sent to the Manager of Statutory Planning as discovered pursuant to the Tribunal's order dated 27 November 2012.

[8] In general, it also appears from photographs of the existing building that a protruding concrete ledge above the second storey windows was an original design feature.

[9] Section 14 of the Planning and Environment Act 1987.

[10] This factual matrix falls well short of justifying indemnity costs for example. This was accepted by the respondents' solicitor.

[11] In the absence of information to the contrary, I have assumed that the costs of Mr Griffin in this costs proceeding are shared equally between the two respondents.

[12] This was important to attesting to the various steps taken on behalf of the permit holder in respect of the feature in question.