Australand Holdings Ltd v Sydney City Council

[2003] NSWLEC 180

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Reported Decision: 126 LGERA 453

Land and Environment Court

of New South Wales

CITATION:	Australand Holdings Ltd v Sydney City Council [2003] NSWLEC 180
PARTIES:	Australand Holdings Limited City of Sydney Council
FILE NUMBER(S):	10411 of 2003
CORAM:	Bignold J
KEY ISSUES:	Costs :- Strike Out Motion dismissed
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979, ss79C, 97
CASES CITED:	Bennett Architects & Associates Pty Ltd v Manly Council (2002) NSWLEC 247; Cameron v Lake Macquarie City Council (2000) 107 LGERA 308; 32; Lehmann v North Sydney Council (Bignold J, 10 December 1997, unreported); MacDonald v Mosman Municipal Council (No.2) (2000) 107 LGERA 211; Starray Pty Ltd v Sydney City Council (2001) 112 LGERA 438
DATES OF HEARING:	24/07/03
DATE OF JUDGMENT:	08/07/2003
LEGAL REPRESENTATIVES:	APPLICANT: Mr T S Hale SC SOLICITORS: Minter Ellison RESPONDENT: Mr D Officer QC SOLICITORS: Maddocks

JUDGMENT:

- 9 -

IN THE LAND AND 10411 of 2003

ENVIRONMENT COURT Bignold J

OF NEW SOUTH WALES 7 AUGUST 2003

AUSTRALAND HOLDINGS LIMITED

Applicant
v

CITY OF SYDNEY COUNCIL

Respondent

Judgment

JUDGMENT

1 The Council seeks an order for costs in relation to the Applicant’s Notice of Motion which by consent has been dismissed.

2 By that Motion the Applicant sought an order striking out two paragraphs of the Council’s Statement of Issues that had been filed in pending Class 1 proceedings which are set down for hearing from 13 to 18 August 2003. Those proceedings involve an appeal pursuant to s97 of the Environmental Planning and Assessment Act 1979 against the Council’s deemed refusal of a development application for the demolition of an existing building and the erection of a residential flat building incorporating some commercial space at premises known as No. 46A Maclaey Street, Potts Point.

3 The two paragraphs from the Council’s Statement of Issues (enumerating 15 issues) which the Applicant’s Motion sought to be struck out were as follows:

“ 4 Whether the proposed development complies with the Central Sydney Local Environmental Plan 1996.

5. Whether the proposed development complies with the Central Sydney Development Control Plan 1996.”

4 The Applicant’s Motion came on for hearing on 10 July 2003. Although fully argued at the end of the hearing it became clear that the Applicant could not press its claim once it had fully appreciated the extent of reliance by the Council upon the planning instruments referred to in paragraphs 4 and 5 of the Statement of Issues. Those instruments applied to land comprising the City of Sydney prior to 8 May 2003 upon which date the transfer to the City of lands from the neighbouring local government areas of South Sydney and Leichhardt (which lands include the development site) took effect by virtue of the Proclamation published in Government Gazette No. 47 of 19 February 2003 pursuant to ss218B and 218C of the Local Government Act 1993.

5 At that hearing the Applicant sought an adjournment to consider its position in relation to the Motion and upon resumption of the hearing the Applicant informed the Court that it did not wish to pursue the relief claimed in its Motion. It was in those circumstances that the Motion was, by consent, dismissed.

6 The question of costs which was reargued (it had also been argued at the first hearing) was reserved.

7 The basis for the Council’s claim to costs was that the Motion had ultimately failed and that accordingly costs which had been unnecessarily incurred by the Council in resisting the Motion should be awarded against the Applicant.

8 The Applicant submitted that no order for costs should be made because there were no exceptional circumstances in terms of the Court’s established practice of not awarding costs in planning appeals save for exceptional circumstances.

9 Furthermore, the Applicant submitted that it was only as a result of the hearing of its Motion that the Council had properly formulated the extent of its reliance upon the planning instruments that do not, in terms, apply to the development site.

10 To adjudicate upon the disputed costs question it is necessary to examine the background to the Applicant’s Motion and what occurred at the hearing.

11 Following the filing and service of the Council’s Statement of Issues the Applicant’s Solicitors by letter dated 10 June 2003 sought the following particulars:

4. In relation to issue 4:

4.1 Please advise why Central Sydney Local Environmental Plan 1996 is relevant to the determination by the Court of this application.

4.2 In what respects do you say the proposed development does not comply with the Central Sydney Local Environmental Plan 1996? Please identify the relevant clauses and how it is alleged the proposed development does not comply with the specified clauses.
5. In relation to Issue 5:
5.1 Please advise why Central Sydney Development Control Plan 1996 is relevant to the determination by the Court of this application.
5.2 In what respects do you say the proposed development does not comply with the Central Sydney Development Control Plan 1996? Please identify the relevant clauses and how it is alleged the proposed development does not comply with the specified clauses.

12 The Council’s Solicitors responded by letter dated 25 June 2003 as follows:

4. Issue 4

4.1 See resolution of the Council of the City of Sydney dated 23 June 2003;

4.2 See resolution of the Council of the City of Sydney dated 23 June 2003;

5. Issue 5

5.1 See resolution of the Council of the City of Sydney dated 23 June 2003;

5.2 See resolution of the Council of the City of Sydney dated 23 June 2003;

13 The relevant Council Resolution was in the following terms:

That arising from consideration of a report by the Manager Strategic Planning to the Extraordinary Meeting of Council on 23 June 2003, on The Amalgamated City of Sydney – Future Planning Policy Directions Responding to the Boundary Changes, it be resolved that Council -

(A) apply the Central Sydney Local Environmental Plan 1996, the City of Sydney Heritage Local Environmental Plan 2000 and Draft City of Sydney Local Environmental Plan 2002 to the transfer areas received from South Sydney and Leichhardt Councils, and in particular apply the aims, objectives and principles of design excellence contained in those instruments;

(B) apply the provisions of Section 6.1 of Central Sydney Development Control Plan 1996 entitled “amenity for Residential Buildings and Serviced Apartments” to the transfer areas received from South Sydney and Leichhardt Councils;

(C) review and consolidate the intended controls in the former South Sydney and Leichhardt Council areas, which now form part of the City of Sydney Local Government Area.

14 Thereafter on 30 June 2003 the Applicant filed its Notice of Motion supported by the affidavit of Ms Hollott, a Solicitor employed by the Applicant’s Solicitors which deposes to the history that I have earlier recited. The Motion came before the Registrar on 4 July 2003 and the hearing date was allocated for 10 July 2003.

15 By facsimile transmission sent 8 July 2003 the Council’s Solicitors sought to resolve the matter without incurring costs on any hearing by advising as follows:

The Respondent is prepared to submit at the hearing of this matter in Class 1, that the instruments of the City of Sydney should be considered as a relevant matter for consideration having regard to the circumstances of the case and in that regard the Statement of Issues should not be amended.

Kindly obtain you (sic) clients instructions in relation to the above.

We put you on notice that if our offer is rejected, and we succeed in resisting your Motion on 10 July 2003 we will tender this letter into evidence on an application for costs on the Motion.

16 The Applicant’s Solicitors responded as follows:

Could you please advise on what basis you consider that paragraphs 4 and 5 of the Statement of Issues are relevant to the Court’s determination of the appeal and in particular, what “circumstances of the case” make these issues relevant.

In our view, it is clear on the face of the Central Sydney Local Environmental Plan and Central Sydney Development Control Plan and from the Proclamation dated 19 February 2003 that they do not apply to the site the subject of this appeal and are therefore not relevant.

17 The foregoing provides the background to the hearing of the Applicant’s Motion.

18 As I have mentioned the Motion was fully argued at the hearing. The only additional matter to emerge at the hearing was that the Council expressly limited its total reliance to the provisions of the Central Sydney Local Environmental Plan 1996 to the portions particularised in the Resolution namely the provisions of the Plan containing “aims, objectives and principles of design excellence”.

19 To the Applicant’s suggestion that the identification of those particular provisions of the 1996 Plan as the provisions to be relied upon by the Council, constituted a concession material to the course and outcome of the hearing (and hence to the question of costs) Senior Counsel for the Council simply retorted that he had conceded nothing more than what was apparent in the express terms of the Council’s Resolution and that the Applicant’s position in bringing the Motion had not been vindicated in any shape or form.

20 On the question of costs the Council submitted that it had been involved in incurring what ultimately proved to be unnecessary costs by virtue of the Applicant bringing the Motion but ultimately not pressing for any relief, for which it should be compensated.

21 The Court’s Practice of not awarding costs in planning appeals except in exceptional circumstances has been held to not apply to discrete proceedings in planning appeals. Thus in MacDonald v Mosman Municipal Council (No.2) (2000) 107 LGERA 211 where following the decision in the planning appeal the successful party by Notice of Motion sought an order for costs (which motion failed) Lloyd J said the following at 215:

In my opinion, the successful party on a notice of motion for costs should not be visited with the costs of resisting the motion. This motion is not part of the planning or building appeal, which has concluded. As Pearlman J stated in Outdoor Australia Pty Ltd v Auburn Council, the practice direction was made to encourage dissatisfied parties to seek review of planning and building decisions without the risk of costs if unsuccessful. The applicant's motion for costs, however, involves an additional appearance and the incurring of additional (and generally unexpected) costs which are not part of the planning and building appeal.

22 To similar effect is the decision in Starray Pty Ltd v Sydney City Council (2001) 112 LGERA 438 where costs were awarded against a party to a concluded planning appeal who had unsuccessfully sought to re-open the case.

23 However, these and similar cases were concerned with discrete proceedings that had been taken after the planning appeal had been determined and are accordingly distinguishable from the present case where the Applicant’s unsuccessful Motion had been raised while the planning appeal was pending in the Court. As such I think it must be concluded that the costs of the Applicant’s unsuccessful Motion are relevantly “costs in the planning appeal”, and the question that arises is whether the present case should be regarded as coming within the ambit of “exceptional circumstances” within the meaning of the Court’s Practice Direction to warrant the making of a costs order against the unsuccessful party.

24 In so formulating and determining the crucial question I adopt the approach taken by Lloyd J in Cameron v Lake Macquarie City Council (2000) 107 LGERA 308 which involved a Strike Out Motion brought by the council in a pending planning appeal as being incompetent. Having held that the Motion should be dismissed Lloyd J next had to determine whether there should be a costs order in favour of the successful party on the Motion. His Honour determined the question of costs by applying the Court’s practice direction and holding that exceptional circumstances had been demonstrated to justify the making of a costs order. In so proceeding he reasoned as follows in paragraphs 29 and 30:

In Outdoor Australia Pty Ltd v Auburn Council (1996) 89 LGERA 365, Pearlman J said (at 369) that "The practice direction was made to encourage dissatisfied parties to seek review of planning and building decisions by councils without the risk of costs if unsuccessful". Pearlman J said that preliminary questions of law heard and determined in development and building appeals will not necessarily follow the event but will themselves be governed by the practice direction and accordingly will not be subject to an order for costs
unless the circumstances are exceptional.

The notice of motion came before me as an application to strike out the appeal as incompetent rather than as the separate determination of a preliminary question of law. I am nevertheless prepared to assume that it is, in substance if not in form, a claim for relief which is to a similar effect as the separate determination of a preliminary question of law. I therefore approach the question of costs as if the practice direction applies.

25 In my judgment the circumstances in which the Applicant brought its Motion, argued it but ultimately did not press it, qualify as exceptional circumstances within the Court’s Practice Direction.

26 The Applicant’s Strike Out Motion to be successful, could only have been properly founded on a proposition of law that the Council’s Resolution applying to the lands transferred to the City of Sydney from the local government areas of South Sydney and Leichhardt the specified planning instruments which expressly apply to the City of Sydney, as that unit of geography existed prior to the effective date for the transfer of the said lands, had no effect under the Environmental Planning and Assessment Act 1979 and in particular in terms of s79C.

27 It may be accepted as unexceptional that such a question of law could have been raised for determination in advance of the hearing of the appeal on the planning merits. But that was not the question raised by the Applicant’s Strike Out Motion. Rather that Motion was founded upon the contentions expressed in the Applicant’s Solicitors’ letter of 8 July 2003 that I have earlier recited. Those contentions, for whatever reason, chose to ignore the Council’s Resolution which had been the sole basis proffered in support of the Council raising issues 4 and 5 in the Statement of Issues.

28 Moreover, and in view of the relevant content of the correspondence between the parties’ respective solicitors, the Applicant in initially pressing its Motion, must be taken to have done so, at the risk of the Council seeking a costs order against it, if the Council was successful on the Motion.

29 In the event the Council was entirely successful on the Motion when the Applicant deliberately chose to ultimately not press for any relief.

30 The Applicant’s submission that it was only in the course of the hearing that the Council clearly enunciated the extent of its reliance upon the specified planning instruments applying to the City of Sydney (as it existed prior to the transfer of lands from South Sydney and Leichhardt) does not aptly reflect the relevant state of affairs existing at the time of the hearing of the Motion as I have earlier narrated them.

31 Ultimately my appraisal of the relevant facts leads me to conclude that the Applicant’s Motion was an unnecessary initiative in the proceedings and hence caused unnecessary costs to be incurred. It is appropriate to repeat what I recently said in Bennett Architects & Associates Pty Ltd v Manly Council (2002) NSWLEC 247:

I would not wish to give any encouragement to unnecessary legal initiatives involving interlocutory applications in planning appeals. The Court's statutory charter is to determine such appeals expeditiously and as economically as the circumstances of the case permit: the LEC Act , s 38(1) .

32 Lehmann v North Sydney Council (Bignold J, 10 December 1997, unreported) provides an example of a costs order being made within the context of the Court’s Practice Direction against a council raising an unnecessary question of law for preliminary determination in a planning appeal.

33 The Court’s established practice of not awarding costs in planning appeals obviously extends to costs normally incurred in such proceedings (including costs of normal interlocutory or preparatory steps in such proceedings. eg preparing the case for hearing and obtaining a hearing date.) However unnecessary or wasteful steps taken in the proceedings, such as the Applicant’s Motion in the present case, are liable, as here, to be regarded as ‘exceptional circumstances’ and costs incurred in such circumstances are apt to be compensable.

34 For all the foregoing reasons I make the following order consequent upon my order made on 24 July 2003 dismissing the Applicant’s Motion:

The Applicant shall pay the Council’s costs on the Applicant’s Notice of Motion filed 30 June 2003 in the sum agreed or failing agreement as assessed.

I HEREBY CERTIFY THAT THE PRECEDING 34 PARAGRAPHS ARE A TRUE AND ACCURATE RECORD OF THE REASONS FOR JUDGMENT OF THE HONOURABLE JUSTICE N R BIGNOLD.

Associate