Boronia Park Preservation Group v MSMG Developments Pty Ltd

[2015] NSWLEC 112

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Boronia Park Preservation Group v MSMG Developments Pty Ltd [2015] NSWLEC 112
Hearing dates:	9 July 2015
Date of orders:	10 July 2015
Decision date:	10 July 2015
Jurisdiction:	Class 4
Before:	Pepper J
Decision:	Application for security for costs dismissed. Application for injunctive relief granted. See orders at [79].
Catchwords:	SECURITY FOR COSTS: whether r 59.11 applies precluding an order for security for costs - whether Class 4 proceedings in the nature of judicial review – whether an order for costs would stultify the proceedings - whether proceedings brought in the public interest – security for costs not ordered.   INJUNCTIONS: interim injunction - serious question to be tried – balance of convenience – no undertaking as to damages – whether proceedings brought in the public interest – interlocutory injunction granted.
Legislation Cited:	Environmental Planning and Assessment Act 1979, ss 76A, 81A, 95, 109F, 123, 124 Land and Environment Court Act 1979, s 20 Land and Environment Court Rules 2007,r 4.2 Uniform Civil Procedure Rules 2005, rr 25.8, 35.2, 42.21, 59.1(b), 59.2, 59.11, 109F(1A)
Cases Cited:	Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2012] NSWLEC59; (2010) 173 LGERA 280 Chief Executive of the Office of Environment and Heritage v Turnbull [2014] NSWLEC 153 Coalcliff Community Association v Minister for Urban Affairs and Planning [1999] NSWCA 317; (1999) 106 LGERA 243 Dungog Shire Council v B and E Clarke [2009] NSWLEC 16 Friends of King Edward Park Inc v Newcastle City Council [2012] NSWLEC 113; (2012) 194 LGERA 226 Hooper v Port Stephens Council [2009] NSWLEC 234 NSWLEC 54 Hume Coal Pty Limited v Alexander [2012] NSWLEC 267 IBB Australia Pty Ltd v Owners Strata Plan 76024 [2014] NSWSC 1835 Iron Gates Developments Pty Ltd v Richmond-Evans Environmental Society (1992) 81 LGERA 132 KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189 Liverpool Plains Shire Council v Vella [2013] Melville v Craig Nowlan & Associates Pty Ltd [2002] NSWCA 32; (2002) 54 NSWLR 82 Oshlack v Rous Water (No 3) [2012] NSWLEC 132 Parks and Playgrounds Movement Inc v Newcastle City Council [2010] NSWLEC 231; (2010) 179 LGERA 346 Save Little Beach Manly Foreshore Incorporated v Manly Council [2013] NSWLEC 155; (2013) 198 LGERA 304 Save our Figs Inc v General Manager Newcastle City Council [2011] NSWLEC 207; (2011) 186 LGERA 127 Shoalhaven City Council v Bridgewater Investments [2010] NSWLEC 103 Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806; (2007) 160 LGERA 1 Willoughby City Council v Sahade [2000] NSWLEC 38
Category:	Consequential orders (other than Costs)
Parties:	Boronia Park Preservation Group (Applicant) MSMG Developments Pty Ltd (First Respondent) Hunters Hill Council (Second Respondent) Barker Ryan Stewart Pty Ltd (Third Respondent)
Representation:	Counsel: J Walker (Applicant) N Eastman (First Respondent)   Solicitors: Woolf Associates Solicitors (Applicant) Hartley Solicitors (First Respondent
File Number(s):	2015/40462

EX TEMPORE Judgment

MSMG Developments Seeks Security for Costs; Boronia Seeks Interim Relief

1. Before the Court are two notices of motion filed in Class 4 proceedings. First, a notice of motion filed by the applicant, Boronia Park Preservation Group Inc (“Boronia”), seeking an interlocutory injunction restraining the first respondent, MSMG Developments Pty Ltd (“MSMG”), from carrying out any development in reliance on a development consent granted by the second respondent, Hunters Hill Council (“the council”), for works at 14A-16 Barons Crescent, Hunters Hill (“the site”). Second, a notice of motion filed 26 June 2015, by MSMG seeking an order that Boronia pay security for costs.

2. For the reasons that follow, the application for security for costs is dismissed but the interim restraint is granted.

The Class 4 Proceedings

3. The Class 4 proceedings were commenced by summons dated 29 May 2015, seeking declaratory and injunctive relief arising out of a development consent granted by the Council on 22 December 2009 for a subdivision (from two lots to three lots) and associated civil works at the site (“the consent”). The consent included condition 30 which provides as follows:

30.     A construction certificate is required to be approved and issued by either Council or an Accredited Certifier, prior to the commencement of any works on the site.

4. Condition 30 was modified on 1 December 2014 in response to a s 96 modification application.

5. Condition 28 of the consent provides that:

28. It is a condition of consent that the applicant, builder or developer or person who does the work on this residential building project arrange the Builders Indemnity Insurance and submit the Certificate of Insurance in accordance with the requirements of Part 6 of the Home Building Act 1989 to the Council for endorsement of the plans accompanying the Construction Certificate. It is the responsibility of the applicant, builder or developer to arrange the Builder’s Indemnity Insurance for residential building work over the value of $12,000 and to satisfy the Council or other Principal Certifying Authority by the presentation to the necessary Certificate of Insurance so as to comply with the applicable requirements of Part 6 of the Home Building Act 1989. The requirements for the Builder’s Indemnity Insurance does not apply to commercial or industrial building work less than $12,000, nor to work undertaken by persons holding an Owner/Builder’s Permit issued by the Department of Fair Trading (unless the owner/builder’s property is sold within 6 years of the of the(sic) work).

Prior to the commencement of any work, the Principal Certifying Authority shall be notified in writing of the name and contractor license number of the owner/builder who intends to carry out the approved works.

6. And condition 33 of the consent stated that:

33.   For the purpose of public safety, a sign shall be erected on the site prior to any work commencing which is clearly visible from a public place stating that unauthorised entry to the site is not permitted and showing the name of the builder or another person responsible for the site, a telephone number for contact outside working hours and the details of the appointed Principal Certifying Authority. The sign may only be removed on satisfactory completion of the works.

7. On 6 January 2015, the council sent a letter confirming that physical commencement had taken place.

8. A construction certificate was issued by Barker Ryan Stewart (“Barker”), the third respondent, in respect of the consent, on 29 April 2015. A Notice of Commencement and Appointment of Principal Certifying Authority was provided to the council for works to commence on 7 May 2015.

9. MSMG claims to have undertaken survey works, tree preservation works, and geotechnical works on the land before 22 December 2014.

10. Boronia contends that these works were unlawful and were therefore ineffective to achieve physical commencement because they were carried out prior to the grant of a construction certificate and in breach of conditions 28, 30 and 33 of the consent. Relevantly, if the works were not carried out lawfully prior to the lapsing of the consent pursuant to s 95 of the Environmental Planning and Assessment Act 1979 (“the EPAA”), then the consent lapsed (Iron Gates Developments Pty Ltd v Richmond-Evans Environmental Society (1992) 81 LGERA 132) on 22 December 2014.

11. Accordingly, Boronia alleges that the construction certificate is invalid because it was granted after the consent had lapsed.

12. Alternatively, Boronia alleges that if the works carried out on the land were “engineering works”, which were effective to lawfully commence the consent under s 95(4) of the EPAA, then these works must also constitute “subdivision work” within the meaning of s 109F(1)(a) of the EPAA, and therefore, the construction certificate is invalid because it was granted after the commencement of the works to which it relates.

13. The summons claims the following declaratory and injunctive relief:

1   A declaration that Development Consent No 09-1019 granted by the second respondent on 22 December 2009 for subdivision and civil works at 14A – 16 Barons Crescent Hunters Hill (“the Consent”) lapsed on 22 December 2014.

2   A declaration that Construction Certificate No SY 140142C01 issued by the third respondent on 29 April 2015 (“the CC”) is void and of no effect.

3   An order restraining the first respondent, its servants and agents from carrying out development in reliance on the Development Consent referred to in paragraph 1.

14. The grounds said to give rise to the entitlement for relief are stated in the summons as follows:

Pursuant to s 95 of the Environmental Planning and Assessment Act 1979 (“the EP&A Act”), the Consent lapsed unless, building, engineering or construction work relating to the subdivision was physically commenced on the land before 22 December 2014.

Building, engineering or construction work relating to the subdivision did not physically commence on the land before 22 December 2014.

In the alternative to 2, to the extent that building, engineering or construction work relating to the subdivision did physically commence on the land before 22 December 2014, that work was unlawful and therefore ineffective to achieve physical commencement for the following reasons:

the work was carried out before a Construction Certificate had been issued;

the work was carried out breach of Condition 28 of the Consent;

the work was carried out in breach of Condition 30 of the Consent (as in force at the time that the work was carried out); and

the work was carried out in breach of Condition 33 of the Consent.

As a result of the matters set out in paragraphs 1-3, the CC is invalid because it was issued after the Consent had lapsed.’

In the alternative to 1-4, the CC is invalid pursuant to s 109F(1A) of the EP&A Act because it was issued after the subdivision work to which it related had been physically commenced on the land the subject of the Consent.

Evidence of Boronia

15. Boronia relied on two affidavits in support of both its application for injunctive relief, and in answer to MSMG’s application for security for costs:

1. first, the affidavit of Mr Bruce Woolf sworn 3 June 2015. Mr Woolf is Boronia’s solicitor; and

2. second, the affidavit of Mr Julian Heath sworn 2 July 2015. Mr Heath is one of the 14 founding members of Boronia.

16. Annexed to the affidavit of Mr Woolf was a report to the council assessing the proposed subdivision and associated work prior to the granting of consent. The report noted that the site was in a foreshore scenic protection area (“the council assessment report”).

17. Extracted in the report was another report by the council’s Bushland and Natural Resources Officer dated 18 November 2009. This latter report noted that:

7.6   Bushland & Natural Resources

Council’s Bushland & Natural Resources Officer by report dated 18 November 2009 states:-

Impact on Vegetation

Removal of Trees – The proposal provides for the removal of 10 living trees, which includes 6 indigenous species. The removal of these trees will be detrimental to the natural values of Hunter’s Hill as the trees provide habitat for wildlife and act as a visual screen for walkers along the Great North Walk Track. Buffalo Creek Reserve is long and narrow, the trees on private land help widen the effective bushland area, adding significantly to the biodiversity of the reserve.

Coastal Saltmarsh Vegetation – There are remnants of coastal saltmarsh vegetation on Buffalo Creek Reserve below the property. This vegetation community is listed as endangered, (NSW Threatened Species Conservation Act 1995), and forms a narrow corridor along some sectors of the Lane Cove River. Coastal Saltmarsh is highly susceptible to changes in drainage as it occupies a niche above mangroves and below bushland where a specific salinity is required for its survival. Changes in drainage and sedimentation due to the development have the potential to degrade this protected vegetation community.

The development proposal has failed to provide sufficient details of the proposed level spreader and silt traps/pits that claims to mitigate the impacts of stormwater on bushland below the property.

Wildlife Corridor

Buffalo Creek reserve is an important wildlife corridor, linking the Field of Mars and Lane Cove National Park to Boronia Park and beyond. The reserve is long and narrow; therefore the retention of native vegetation on the adjoining private land is essential to ensure that the area is of sufficient width to be value of wildlife. The development application proposes to remove a significant number of trees on land adjoining Buffalo Creek Reserve and is contrary to plans for a regional wildlife corridor. In addition, understorey plants will need to be removed to comply with RFS requirements for an Asset Protection Zone; the removal of these plants will further reduce the value of the wildlife corridor.

Aboriginal Heritage Sites

The proposed development is located above an Aboriginal Heritage Site in Buffalo Creek Reserve. Changes in drainage and sedimentation as a result of the development may impact on the site and other Aboriginal sites in the vicinity. Aboriginal Heritage Sites are protected under the NSW National Parks and Wildlife Act 1974.

The development proposal has failed to provide sufficient details of the proposed level spreader and silt traps/pits that claims to mitigate the impacts of stormwater on Aboriginal Heritage Sites below the property.

Visual Impact

The Great North Walk Track is situated in the bushland reserve immediately below the proposed development. When viewing the development site from the walking track it is apparent that a new house will be highly visible to walkers using this regionally significant trail. The proposed vegetation clearing will further increase the visibility of the house from the Great North Walk Track.

18. The council assessment report noted that submissions were received from 12 households on Barons Crescent, a number of which complained of the excessive tree removal. In this regard the council commented that:

●   The environment and neighbours will be detrimentally affected.

Comment: Due to the potential loss of a number of mature and significant trees from the sites, a recommendation has been imposed to this approval, which does not permit the removal of any such trees from the sites, at this stage. This is on the basis that the local environment would be degraded without any dwelling constructed within these areas, hence such loss will have a detrimental effect on the amenity of adjoining and nearby residents. This issue of tree removal, however, will be subject of future development applications for the construction of dwelling houses and garages on the new sites to be subdivided.

19. And that:

●   Loss of habitat for local species of wildlife

Comment: This is considered an important issue for Council in its assessment of the application due to the number of nature trees to be removed as originally proposed for the site. This will have detrimental implications on the local species of wildlife including the endangered species that live in and use the local bushland including Buffalo Creek reserve. Under these circumstances, it is considered that this is a justifiable reason for not agreeing to the removal of any trees from the site at this stage. This matter will have to be addressed in detail once development applications are lodged with Council in the future for the erection of dwelling houses and the removal of trees from the sites.

20. Mr Woolf deposed to the fact that Boronia was incorporated on 18 May 2015. On 19 May 2015 Boronia’s Constitution came into existence. This was confirmed by a copy of the application for registration of an incorporated association that was tendered by MSMG. The “Constitution, objects and principal activity” of Boronia was described in that document as, “to protect the natural amenity of the community and its environment”. The principal activity of the association was listed as “environment/horticulture/animal protection”.

21. The affidavit of Mr Heath was objected to in its entirety on the grounds that Mr Heath was not available for cross-examination. However, as it transpired, MSMG gave Boronia less than 24 hours’ written notice of it its intention to question Mr Heath, notwithstanding that it had been served with the affidavit over a week prior to the hearing of the notice of motion.

22. Rule 35.2 of the Uniform Civil Procedure Rules 2005 (“the UCPR”) relevantly provides that:

35.2 Cross-examination of deponent

(1)     A party may, by written notice served on the party serving or proposing to use an affidavit, require the attendance for cross-examination of the person by whom the affidavit has been made.

(2)     Such notice is to be given a reasonable time before the time at which the person is required to attend for cross-examination.

(3)     If reasonable notice of such a requirement has been given in respect of an affidavit, and the deponent does not attend for examination, the affidavit may not be used unless the deponent is dead or unless the court orders otherwise.

23. In my opinion, the notice afforded to Boronia was not reasonable in all the circumstances and the Court otherwise ordered under r 35.2(3) that the evidence be admitted. However, full weight has not been accorded to its contents in light of the fact that it could not be tested. In addition, some paragraphs, which were irrelevant to the application before the Court, were excluded.

24. Mr Heath occupies a property at 18C Barons Crescent, which adjoins the site. From the rear deck of his house he has a “good view” of most of the site. On 11 February 2015, he observed tree loppers attending at 16 Barons Crescent to remove trees. Mr Heath, along with several other local residents, attended the site to object to the removal of the trees. The work continued the next day, and again, on 2 April 2015.

25. Significantly, Mr Heath attached a letter addressed to him in his capacity as Chairperson of Boronia, from Ms Cathy Merchant, the President of the Ryde-Hunter’s Hill Flora and Fauna Preservation Society (“the Society”), dated 3 June 2015.

26. Ms Merchant wrote to Mr Heath, on behalf of the Society, which, she stated, had been active in the local area for almost 50 years. She noted that the Society was increasingly concerned about the number of subdivisions occurring within the local area, particularly along the bushland within Boronia Park. The letter went on to discuss, in the author’s opinion, the importance of the bushland and, in particular, the natural foreshore section of the Great North Walk along Boronia Park, which is near Barons Crescent. Ms Merchant expressed the Society’s concern that the value of “this important stretch of foreshore bushland” would be damaged by overdevelopment of large subdivided blocks.

27. In particular, the letter discussed the potential adverse impacts of development along Barons Crescent in close proximity to the foreshore and the Great North Walk Track. This included, for example, unacceptable storm water flows, loss of vegetation at every strata level, built areas visual from the harbour and along the Great North Walk Track, likely adverse impacts on nearby Coastal Saltmarsh, loss of native fauna habitat, loss of seed bank associated with excavation, and the modification of natural topography. In the longer term, these impacts could potentially contribute to reduced water quality, reduced local biodiversity, reduced native fauna, and flora habitat availability, and reduced public amenity. Accordingly, the Society supported Boronia’s concerns that the subdivision at 14A and 16 Barons Crescent would result in “significant incremental damage to this very important natural bushland remnant along the Lane Cove River which is a much valued area of Hunters Hill”.

Evidence of MSMG

28. MSMG relied on two affidavits in respect of the applications:

1. first, the affidavit of Mr Gordon Hartley, sworn 26 June 2015. Mr Hartley is the solicitor for MSMG; and

2. second, the affidavit of Mr Michael Tadros, sworn 3 July 2015. Mr Tadros is a director of MSMG.

29. Mr Tadros deposed to the following:

1. that the property is a the most substantial asset owned by MSMG;

2. that the development and sale of the property is its principal business purpose;

3. that MSMG is in a position to undertake further work in accordance with the consent immediately;

4. that MSMG intends to complete the development approved by the consent as soon as possible and then sell the property. It is expected that the sale price will exceed the amount owed by it and result in a net profit;

5. that alternatively, MSMG may seek to develop the property beyond the development approved in the consent by, for example, seeking approval to construct dwellings on the property. A final decision will be made once the development approved by the consent is completed and will be based on the financial circumstances of the company and the state of the market; and

6. that if an injunction was granted and there was a delay of some months before a final determination was made by the Court, MSMG would suffer the following losses and damages:

Holding Costs – Interest

17.   The first respondent has borrowed money to purchase the Property and to carry out the development approved by the Consent (‘Loans’).

18.   The first respondent pays interest on Loans in the amount of $8,536.83 per month.

Holding Costs – Other

19.   The first respondent is also liable to pay costs to maintain the Property. These include insurance, rates, water, land tax, accounting fees and bank fees.

20.   Insurance paid by the first respondent in relation to the Property amount to approximately $1,800 per annum.

21.   Council rates paid by the first respondent in relation to the Property amount to approximately $2,000 per annum.

22.   Water rates paid by the first respondent in relation to the Property amount to approximately $2,556 per annum.

23.   Land tax paid by the first respondent in relation to the Property amount to approximately $29,000.

24.   Accounting fees including compliance with ASIC reporting requirements paid by the first respondent amount to around $2,000 per annum.

25.   Bank fees paid by the first respondent amount to approximately $240 per annum.

26.   In total the first respondent’s holding costs amount to approximately $180,000 per annum.

30. Mr Tadros was not required for cross-examination.

31. In addition, MSMG relied on a council email from Mr Heath to various council officers, including Ms Sue Philpott, indicating that “on behalf of the neighbours of the development the opinion had been formed that the consent had lapsed because no substantial works had been undertaken”. The “neighbours” referred to in the email comprised 14 individuals, all of whom lived in either immediate or close proximity to the site.

32. MSMG invited the Court to infer that these 14 individuals were the persons comprising the founding member of Boronia. But apart from the coincidence of the same number of individuals, there was nothing else that would permit the Court to draw this inference with confidence and I declined to do so.

Security for Costs

33. Part 59 of the UCPR is concerned with “Judicial review proceedings”. Part 59 applies to “proceedings for or in the nature of judicial review in Class 4 or Class 8 jurisdiction of the Land and Environment Court” (r 59.1(b), emphasis added).

34. The composite term “Judicial review proceedings” is rather elliptically defined in r 59.2 to mean “proceedings to which this Part applies”.

35. Critically, r 59.11 prohibits applications for security for costs in certain classes of proceedings:

59.11 Security for costs

(1)   A plaintiff is not to be required to provide security for costs in respect of judicial review proceedings except in exceptional circumstances.

(2)   Where a plaintiff:

(a) invokes an open standing provision, or

(b) commences representative proceedings,

the court is not to treat the plaintiff as bringing proceedings for the benefit of a third party for the purposes of considering whether exceptional circumstances exist.

(3)   This rule has effect despite rule 42.21.

36. As expressed, the rule has effect despite r 42.21 of the UCPR. That later provision states:

42.21 Security for costs

(1)   If, in any proceedings, it appears to the court on the application of a defendant:

(a)   that a plaintiff is ordinarily resident outside Australia, or

(b)   that the address of a plaintiff is not stated or is misstated in his or her originating process, and there is reason to believe that the failure to state an address or the misstatement of the address was made with intention to deceive, or

(c)   that, after the commencement of the proceedings, a plaintiff has changed his or her address, and there is reason to believe that the change was made by the plaintiff with a view to avoiding the consequences of the proceedings, or

(d)   that there is reason to believe that a plaintiff, being a corporation, will be unable to pay the costs of the defendant if ordered to do so, or

(e)   that a plaintiff is suing, not for his or her own benefit, but for the benefit of some other person and there is reason to believe that the plaintiff will be unable to pay the costs of the defendant if ordered to do so, or

(f)   that there is reason to believe that the plaintiff has divested assets with the intention of avoiding the consequences of the proceedings,

the court may order the plaintiff to give such security as the court thinks fit, in such manner as the court directs, for the defendant’s costs of the proceedings and that the proceedings be stayed until the security is given.

(1A)   In determining whether it is appropriate to make an order that a plaintiff referred to in subrule (1) give security for costs, the court may have regard to the following matters and such other matters as it considers relevant:

(a)   the prospects of success or merits of the proceedings,

(b)   the genuineness of the proceedings,

(c)   the impecuniosity of the plaintiff,

(d)   whether the plaintiff’s impecuniosity is attributable to the defendant’s conduct,

(e)   whether the plaintiff is effectively in the position of a defendant,

(f)   whether an order for security for costs would stifle the proceedings,

(g)   whether the proceedings involves a matter of public importance,

(h)   whether there has been an admission or payment in court,

(i)   whether delay by the plaintiff in commencing the proceedings has prejudiced the defendant,

(j)   the costs of the proceedings,

(k)   whether the security sought is proportionate to the importance and complexity of the subject matter in dispute,

(l)   the timing of the application for security for costs,

(m)   whether an order for costs made against the plaintiff would be enforceable within Australia,

(n)   the ease and convenience or otherwise of enforcing a New South Wales court judgment or order in the country of a non-resident plaintiff.

37. Notwithstanding the declaratory relief claimed by Boronia in the summons, MSMG submitted that Pt 59 of the UCPR, and therefore r 59.11, did not apply to these Class 4 proceedings because, properly classified, they were neither judicial review proceedings nor were they proceedings in the nature of judicial review. This was so notwithstanding that, somewhat incongruously, in its written submissions MSMG conceded that the attempt by Boronia to impugn the decision of the private certifier for issuing the construction certificate was in the nature of judicial review.

38. As I understood them, MSMG’s submissions in this regard were three-fold:

1. first, the Court derived its judicial review jurisdiction from s 20(1)(e) (and therefore s 20(2) and (3)) of the Land and Environment Court Act 1979 (“the LEC Act”) and not s 20(1)(c) of that Act (proceedings under s 123 of the EPAA). These proceedings sought relief under s 123 of the EPAA for breach of s 76A of that Act and were, therefore, in the nature of civil enforcement proceedings;

2. second, r 59.11 was not engaged when only a minor part of the claim concerns judicial review; and

3. third, if it was, then the rule should only apply to that portion of the claim seeking judicial review, and security for costs could be sought in respect of the remainder of the matter.

39. In my opinion, these submissions should be rejected for several reasons. First, the Court has jurisdiction to hear the matter by reason of both s 20(1)(c) and (1)(e) of the LEC Act. There are not mutually exclusive, but overlap. Section 20(1)(e) picks up the jurisdiction contained in s 20(2) of the LEC Act, including, not only the enforcement of a right under s 20(2)(a), but also the jurisdiction to review the exercise of a function conferred or imposed by a planning or environmental law (s 20(2)(b)), and to make declarations of right in relation to any such right, duty, obligation, or exercise of function (s 20(2)(c)). This constitutes the Court’s judicial review jurisdiction.

40. In granting the construction certificate, Barker, although a private certifier, was exercising a function or power conferred by the EPAA. A review of the exercise of this function falls within the jurisdiction of the Court pursuant to s 20(2)(b) of the LEC Act. The issuing of a declaration of invalidity consequent upon that review falls within the Court’s jurisdiction to grant the relief sought in prayer 2 of the summons. In other words, the judicial review jurisdiction of the Court is engaged and the proceedings may be characterised not only as proceedings in the nature of judicial review, but as judicial review. That restraint, or some other remedy, is sought pursuant to s 123 of the EPAA does not derogate from this conclusion. The reliance on s 123 of the EPAA by Boronia in these proceedings is to obviate the need for it to establish standing.

41. Second, civil enforcement proceedings brought in Class 4 of the Court’s jurisdiction generally (but not universally) do not seek declarations of invalidity. Rather, declarations as to a breach of an environmental or planning statute or instrument is sought under s 123 of the EPAA, together with additional relief under s 124 of that Act, to compel the respondent to take positive steps to remedy the breach. This has not been sought in the present case.

42. Third, although grounds 1 to 3 of the summons deal expressly with the issue of the lapsing of the consent, grounds 4 and 5 nevertheless allege invalidity with respect to the construction certificate and consequential declaratory relief is sought. Contrary to the submission of MSMG, this relief is needed. In the absence of the construction certificate being set aside, it remains valid.

43. Fourthly, ground 4, combined with the relief sought in the summons, is unarguably in the nature of judicial review. Likewise ground 5 of the summons, which is, also contrary to the contention of MSMG, a discrete ground of judicial review that is wholly separate to the claims contained in grounds 1 to 4. Thus even if Boronia were to fail on its so-called civil enforcement grounds (grounds 1 to 3) because MSMG was able to factually prove lawful physical commencement of the consent, Boronia nevertheless seeks to impeach the construction certificate on an alternative legal ground.

44. It is therefore incorrect to state, as MSMG does, that grounds 4 and 5 are otiose to Boronia’s application and that, therefore, these are not judicial review, or in the nature of judicial review, proceedings.

45. Finally, although there is other relief sought in the proceeding that may not be characterised as judicial review, the proceedings must be characterised as a whole and an application for security for costs cannot sensibly be made in respect of one aspect of the proceedings isolated from all others.

46. I therefore find that r 59.11 of the UCPR applies to these proceedings. Accordingly, MSMG must demonstrate exceptional circumstances in order for the Court to be able to exercise its discretion to order security for costs.

Exceptional Circumstances

47. The fact that members of an incorporated association do not offer to pay an undertaking as to damages (Save Little Beach Manly Foreshore Incorporated v Manly Council [2013] NSWLEC 155; (2013) 198 LGERA 304 at [12]) or are impecunious (IBB Australia Pty Ltd v Owners Strata Plan 76024 [2014] NSWSC 1835 at [57]–[61]) are not exceptional circumstances. Were it otherwise, the function and purpose of r 59.11 would be subverted.

48. There was nothing in either MSMG’s submission or evidence that demonstrated exceptional circumstances sufficient to engage the Court’s jurisdiction to order security for costs and the notice of motion must be dismissed with costs.

49. Even if the above analysis is incorrect and the Court’s jurisdiction was enlivened, the result would be, in my opinion, the same. This is because on the evidence I find that, pursuant to r 42.21 of the UCPR, security should not be ordered.

50. In Friends of King Edward Park Inc v Newcastle City Council [2012] NSWLEC 113; (2012) 194 LGERA 226, Biscoe J made the following general observations in relation to security for costs applications (at [35]):

Putting public interest litigation considerations aside for a moment, the exercise of the power to order security for costs is a "balancing process", requiring the doing of justice between the parties. The Court should have a concern to achieve a balance between ensuring that adequate and fair protection is provided to a respondent, and avoiding injustice to an impecunious applicant by unnecessarily shutting it out or prejudicing it in the conduct of the proceedings: Idoport at [47] per Einstein J. The exercise of the power requires consideration of the particular facts of the case: Merribee Pastoral Industries Pty Ltd v Australia and New Zealand Banking Group Ltd [1998] HCA 41, 193 CLR 502. The weight to be given to any particular consideration depends upon its own "intrinsic persuasiveness" and its impact on other circumstances, which have to be weighed: Acohs Pty Ltd v Ucorp Pty Ltd [2006] FCA 1279, 155 FCR 181 at [11]. There is no code to be strictly applied: John Williams at [24].

51. Having regard to now often quoted factors to be taken into account in the exercise of the Court’s discretion to order security for costs as set out in KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189 (at 197-198 per Beazley JA), and as enshrined in r 42.21 of the UCPR, I find that:

1. an order for security for costs would stifle the litigation;

2. the proceedings have been genuinely brought by Boronia;

3. a preliminary assessment of the merits of the proceedings at this nascent stage indicates that the issues raised by Boronia have reasonable prospects of success;

4. there has been no delay in commencing the proceedings by Boronia having regard to the date when the construction certificate was issued. While MSMG complained of delay relative to the date upon which the consent was granted (2009), in my opinion, Boronia was entitled to wait until the construction certificate was issued, thereby resulting in the physical harm to the trees, prior to commencing the proceedings. Absent a construction certificate, no development works could commence on the site and no harm ensued;

5. there is no cogent evidence that Boronia is not suing for its benefit but is suing for the benefit of other persons, namely, the neighbours referred to the email from Mr Heath to Ms Sue Philpott; and

6. pursuant to r 4.2(2) of the Land and Environment Court Rules 2007 (“the LEC Rules”), the proceedings have, in my view, been brought in the public interest. This is elaborated upon below.

The Proceedings Are Brought in the Public Interest

52. Rule 4.2 of the LEC Rules states that:

4.2 Proceedings brought in the public interest

(1)   The Court may decide not to make an order for the payment of costs against an unsuccessful applicant in any proceedings if it is satisfied that the proceedings have been brought in the public interest.

(2)   The Court may decide not to make an order requiring an applicant in any proceedings to give security for the respondent’s costs if it is satisfied that the proceedings have been brought in the public interest.

(3)   In any proceedings on an application for an interlocutory injunction or interlocutory order, the Court may decide not to require the applicant to give any undertaking as to damages in relation to:

(a)   the injunction or order sought by the applicant, or

(b)   an undertaking offered by the respondent in response to the application,

if it is satisfied that the proceedings have been brought in the public interest.

53. Boronia is a not for profit association whose objective is “to protect the natural amenity of the community and its environment”. In addition to having been brought for the purpose of upholding and enforcing compliance with the statutory planning regime, the proceeding have principally been brought, as the evidence of Mr Heath demonstrates, out of a concern to preserve the trees on the site (up to 10 or 11 trees are likely to be destroyed) and to protect the surrounding remnant native bushland and public amenity. There is, moreover, no evidence before the Court that Boronia stands to profit from the outcome of the proceedings. On any view, these matters are sufficient to allow the characterisation of the proceedings as being in the public interest.

54. MSMG argued, however, that this was insufficient and, applying the three step approach to determine whether to award costs in public interest litigation as articulated in Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2012] NSWLEC 59; (2010) 173 LGERA 280 (at [13]) and as applied to security for costs applications by Biscoe J in Save our Figs Inc v General Manager Newcastle City Council [2011] NSWLEC 207; (2011) 186 LGERA 127 (at [14]-[15]) and Parks and Playgrounds Movement Inc v Newcastle City Council [2010] NSWLEC 231; (2010) 179 LGERA 346 (at [171]-[173]), “something more” than the mere characterisation of the litigation as being in the public interest was required.

55. It is contestable whether this additional requirement should be imposed on an applicant resisting a security for cost application, which arguably involved different considerations to that of a successful party to litigation who, after a full hearing on the merits, is usually entitled to be compensated for the costs that he or she has had to incur in the proceedings.

56. But having said this, it would be legislatively aberrant if what was required to demonstrate the fact that proceedings had been “brought in the public interest” differed internally within r 4.2. It may generally be assumed that terms contained within the same provision are given cognate meanings, and ascribed the same work to do.

57. Furthermore, I am mindful of the observations of Heydon JA in Melville v Craig Nowlan & Associates Pty Ltd [2002] NSWCA 32; (2002) 54 NSWLR 82 in relation to the open standing provisions of the EPAA (at [102]):

102. There is, however, one significant difference between the type of litigation to which the traditional rules as to security for costs applied, including the rule to which the claimant appeals, and s 123(1) litigation. Leaving aside instances of statutory standing, leaving aside the role of the Attorney-General (acting either alone or on the relation of another), and leaving aside the capacity of citizens to utilise the prerogative writs to control government action, most civil litigation was traditionally conducted by one person or a small group of persons seeking to vindicate rights enforceable only by that person or persons. If D broke a contract to which P was the only other party, in general only P could enforce it. If D committed a tort against P and no-one else, in general only P could complain. Hence if P were impecunious, the effect of ordering a stay until security for D’s costs was provided was to prevent D’s breach of the law from being remedied at all. In its practical operation, the rule against orders that impecunious natural persons provide security for costs overlaps with the disinclination of courts, in their discretion, to make orders the effect of which would be to frustrate the particular litigation. So far as D’s conduct extended beyond actionable damage to P alone and damaged the public, any plaintiff had to comply with the criteria for standing stated in Boyce v Paddington Borough Council [1903] 1 Ch 109, which, even as modified by such High Court cases as Australian Conservation Foundation Inc v Commonwealth of Australia (1980) 146 CLR 493, were not easy to satisfy. But provisions permitting “any person” to commence litigation have abolished standing requirements. Like the equivalent words in s 80(1) of the Trade Practices Act 1974 (Cth) (Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591), the words “any person” in s 123(1) are not to be read as meaning anything different from what they say: Sydney City Council v Building Owners and Managers Association of Australia Ltd (1985) 2 NSWLR 383 at 386-7. It is true that before the enactment of s 80 in 1974 and s 123 in 1979, there were numerous statutes granting standing to affected persons or to any person. But these statutes tended to operate in specific and limited areas. They did not apply in fields as extensive as the fields of human activity to which the Trade Practices Act and the Environmental Planning and Assessment Act apply. They did not alter the general character of civil litigation as being litigation between one or a small number of injured plaintiffs and one or a small number of defendants. Personal right and remedy were generally closely linked. If a plaintiff was debarred by a stay until provision of security from proceeding with litigation, the wrong committed or threatened by the defendant was incapable of remedy. That is not true where standing is wide and unrelated to a legal wrong specifically injuring the particular plaintiff. Under s 123(1) any natural person in the world can sue, and any corporate person. It is true that any impecunious corporate person can be ordered to provide security. It is also true that any person not resident in New South Wales can be ordered to provide security under Pt 53 r 2(a). But it has been held that because of s 117 of the Commonwealth of Australia Constitution Act 1900 (Imp) [63 & 64 Vict c 12] that provision is only valid to the extent that it permits orders against persons resident outside the Commonwealth. (This was held in Australian Building Construction Employees’ & Builders’ Labourers’ Federation v Commonwealth Trading Bank [1976] 2 NSWLR 371; it was doubted in Rajski v Computer Manufacturing and Design Pty Ltd [1982] 2 NSWLR 443 at 451; that doubt was in turn rejected in Ceil Comfort Insulation Pty Ltd v ARM Equipment Finance Pty Ltd [2001] NSWSC 28 at [52]-[55].) That leaves nearly 20,000,000 natural persons capable of enforcing the Environmental Planning and Assessment Act, together with however many corporations there are in Australia. Even if many of the natural persons and many of the corporations are impecunious, there are large numbers of potential plaintiffs remaining. That proposition remains true even if Pt 53 r 2(1)(a) is entirely valid, for New South Wales has a large population of solvent human and corporate persons. The claimant in argument to this Court made the point that it can take time for persons concerned about breaches of environmental law to raise money to conduct litigation or to find plaintiffs with the financial strength to provide security, and time limits for challenging illegal action are often short. Even if these considerations are taken at their highest, litigation under s 123(1) is still of a totally different kind from the type of litigation in which the courts worked out the general rule that poverty did not bar access to the court.

58. Assuming for present purposes that “something more” must be demonstrated, circumstances that may constitute “something more” were summarised by the Court in Oshlack v Rous Water (No 3) [2012] NSWLEC 132 to include (at [12]):

The "something more" may, for example, be found in the magnitude of the public interest itself (Caroona at [59]). There are, in addition, at least five categories of circumstances that have been identified as constituting "something more" for the purpose of step two (Caroona at [60]):

(a)   the litigation raises one or more novel issues of general importance;

(b)   the litigation has contributed, in a material way, to the proper understanding, development or administration of the law;

(c)   the litigation was brought to protect the environment, or some component of it, and the environment, or particular component of it, is of significant value and importance;

(d)   the litigation affects a significant section of the public; and

(e)   there was no financial gain to the applicant in bringing the proceedings.

59. I do not need to determine if Biscoe J is plainly wrong (which is the test) in importing the “something more” element into applications for security for costs because I find that, in any event, on balance the requirement is met on the facts of this application. This is because, first, the litigation was brought to protect a component of the environment of significant value and importance, namely, the Great North Walk Track and the natural bushland remnant (Buffalo Creek Reserve), including the endangered Coastal-Saltmarsh vegetation, along the Lane Cove River. Second, the litigation affects a significant section of the public and not just Boronia, namely, those members of the public who use the Great North Walk Track, the members of the Ryde-Hunter’s Hill Flora and Fauna Preservation Society, and the general public. And third, there is no evidence of any financial gain to Boronia in bringing this application.

60. Finally, there is, assuming that the third step in Caroona is also applicable, no suggestion that by reason of its conduct, security for costs ought to be ordered against Boronia. Its incorporation only 11 days prior to commencing proceedings would not compel such a conclusion.

61. I therefore find that even if r 59.11 does not apply, the Court would not exercise its discretion to make the order for security for costs sought by MSMG.

Interlocutory Injunction

62. The legal principles to be applied in determining whether or not to grant interlocutory relief have been set out in a number of cases in this Court (see Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806; (2007) 160 LGERA 1 at [6]-[58]; Shoalhaven City Council v Bridgewater Investments (“Bridgewater Investments”) [2010] NSWLEC 103 at [4]-[6]; Save Our Figs Inc v General Manager Newcastle City Council [2011] NSWLEC 207; (2011) 186 LGERA 127 at [37] and Hume Coal Pty Limited v Alexander [2012] NSWLEC 267 at [69]-[82]).

63. In Bridgewater Investments, Biscoe J helpfully and succinctly summarised those principles, which I respectfully adopt, as follows (at [4]-[5]):

4   An applicant for an interlocutory injunction must establish that there is at least a serious question to be tried and that the balance of convenience favours the grant of the interlocutory injunction: Castlemaine Tooheys Ltd v South Australia [1986] HCA 58, 161 CLR 148 at 153-4; Inetstore Corporation Pty Ltd (in liq) v Southern Matrix International Pty Ltd [2005] NSWSC 883 at [13] (Campbell J); Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806, 160 LGERA 1 at [6] (Preston CJ). The Court must consider whether the harm which the applicant (or, in environmental cases, the environment) would be likely to suffer if an interlocutory injunction were refused outweighs or is outweighed by the harm or inconvenience which the respondent or a third party would be likely to suffer if the injunction were granted: Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 at 623; Tegra at [18]-[19]. Thus, the balance of convenience is more weighty than mere convenience and involves balancing the risk of doing an injustice: Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533 at 536 (McLelland J). Although normally the Court does not undertake an interlocutory trial and give or withhold interlocutory relief upon a forecast as to the ultimate result of the case (Beecham at 622), in some cases the strength of the applicant's case, above the threshold of a serious question, may be relevant to the risk of doing an injustice: Castlemaine at 154; Kolback at 536.

5   Usually, an applicant for an interlocutory injunction is required to give the Court an undertaking as to damages. This undertaking underwrites the risk, and responds to the court's anxiety, that the grant of the interlocutory injunction might later prove to be the wrong course of action and cause the respondent or a third party damage for which there is no redress except by an order for costs: European Bank Ltd v Evans [2010] HCA 6, 264 ALR 1 at [15]; Inetstore at [28]; Tegra at [28]-[31]. …

64. In short, to obtain an interlocutory injunction Boronia must show that there is a serious question to be tried and that the balance of convenience favours the grant of interim relief.

65. As stated above, no undertaking as to damages is proffered by Boronia because, as it candidly admits, it does not have sufficient resources to do so.

Serious Question to be Tried

66. It was properly, and correctly, conceded by MSMG that the application raises several serious questions to be tried. These include:

1. when did the works relied upon by MSMG as evidencing the physical commencement of the consent occur and was it sufficient;

2. whether the works undertaken by MSMG were in breach of conditions 28, and 30 and 33 of the consent;

3. if so, whether the works were ineffective to achieve physical commencement within the meaning of s 95(4) of the EPAA because they were unlawful and unauthorised (Coalcliff Community Association v Minister for Urban Affairs and Planning [1999] NSWCA 317; (1999) 106 LGERA 243 at [66]);

4. whether the works were unlawful because they constituted subdivision works carried out prior to the grant of a construction certificate, and therefore, were in breach of s 81A(4) of the EPAA; and

5. whether the construction certificate was invalid because it was issued after the subdivision works to which it related were physically commenced on the land to which the relevant development consent applied contrary to s 109F(1A) of the EPAA.

Balance of Convenience

67. Notwithstanding the evidence of the losses likely to be incurred by MSMG if the interlocutory injunction was granted, MSMG submitted that the balance of convenience favoured Boronia insofar as the granting of the interim relief would retain the status quo, namely, the retention of the trees.

68. On the evidence referred to above, I accept this to be the case. The trees, once removed, will be lost forever and the potential harm to the environment enduring. It is also the case that some, but not all as was suggested by Boronia, of the holding costs presently being incurred by MSMG are costs that it has been incurring since the property was purchased.

69. In this context, Boronia indicated that it would consent to an order expediting the final determination of the proceedings to reduce all delay to a minimum. The Court would be amenable to this course if such an application were made.

No Undertaking as to Damages

70. The gravamen of the dispute between the parties in respect of the application for an interlocutory injunction is whether the inability of Boronia to give the usual undertaking as to damages due to its impecuniosity is fatal to the interim relief it seeks.

71. MSMG submits that it is, in light of the holding costs, that it is incurring, whereas Boronia relies on the discretion afforded to the Court in r 4.2(3) of the LEC Rules, to waive the usual requirement to give such an undertaking where the Court is satisfied that the proceedings are in the public interest.

72. Rule 25.8 of the UCPR defines “usual undertaking as to damages” to mean:

The “usual undertaking as to damages”, if given to the court in connection with any interlocutory order or undertaking, is an undertaking to the court to submit to such order (if any) as the court may consider to be just for the payment of compensation (to be assessed by the court or as it may direct) to any person (whether or not a party) affected by the operation of the interlocutory order or undertaking or of any interlocutory continuation (with or without variation) of the interlocutory order or undertaking.

73. Again, MSMG stated that the “something more” element was missing from the Caroona three step approach to determine whether the proceedings had been brought in the public interest (Biscoe J in Save Our Figs at [69]-[70] and Parks and Playgrounds Movement at [171]-[173]). Again, it is debatable whether this element must be demonstrated for an applicant to take the benefit of r 4.2(3) of the LEC Rules. I note that it has not been required to be demonstrated in cases where the applicant is a public body, such as a prosecutor or local council, seeking to enforce environmental and planning laws (see Willoughby City Council v Sahade [2000] NSWLEC 38 at [24]; Tegra at [28]-[31]; Hooper v Port Stephens Council [2009] NSWLEC 234 at [28]; Dungog Shire Council v B and E Clarke [2009] NSWLEC 16 at [14] and Liverpool Plains Shire Council v Vella [2013] NSWLEC 54 at [29], and Chief Executive of the Office of Environment and Heritage v Turnbull [2014] NSWLEC 153 at [19]).

74. However, the debate is moot because, for the reasons given above in relation to the application for security for costs, I am satisfied that, on balance, the proceedings were brought in the public interest.

75. Against this conclusion, MSMG forcefully submitted that the decision of the council to grant the consent (albeit with conditions), cognisant of the importance of the trees both to the local ecology and landscape and the broader community, ought to be respected and accorded substantial weight. Put another way, MSMG has a valid consent upon which they are entitled to rely. And, having properly considered most of the environmental factors that Boronia now relies upon to obtain interim relief, the council nevertheless determined to grant the consent, suggests that the trees were, from an environmental perspective, insignificant and did not warrant preserving. This strengthened the need for an undertaking as to damages to be given by Boronia.

76. But councils do not always make the correct decision when granting consents. Moreover, there may be many reasons why Boronia, or those who comprise it, have not acted until now. Development inactivity and a belief that the consent had lapsed is one explanation. Furthermore, the logical corollary of Boronia’s contention is that undertakings as to damages would be universally required in circumstances where a development consent had been granted but an interlocutory injunction was sought to prevent it from being carried out. This result would, in my view, be contrary to the terms and objects of r 4.2(3) of the LEC Rules.

77. I therefore do not require Boronia to give an undertaking as to damages.

78. Given that I have found that a there is a serious question to be tried and that the balance of convenience favours the issuing of the injunction, the relief sought by Boronia in its notice of motion should be granted. To reiterate, however, the Court would be minded, in light of the evidence before it to date, to accede to an application for expedition of the final hearing of the proceedings were either party to make it.

Conclusion and Orders

79. In conformity with the reasons given above, the formal orders of the Court are:

1. the first respondent’s application for security for costs is dismissed;

2. the first respondent, its servants and agents, are restrained from carrying out any development in reliance on development consent no 09-1019 granted by the second respondent on 22 December 2009, for subdivision and civil works at 14A-16 Barons Crescent, Hunters Hill, until further order of the Court;

3. the first respondent is to pay the applicant’s costs of both notices of motion;

4. the exhibits are to be returned upon publication of this judgment on Caselaw; and

5. the matter is listed for further directions before Pepper J at 11am on 10 July 2015.

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Amendments

14 July 2015 - Heading paragraph 1 - now reads "MSMG Developments Seeks Security for Costs; Boronia Seeks Interim Relief"

Paragraph 3 - subdivision (from three lots to two lots) now reads as - subdivision (from two lots to three lots)

Decision last updated: 14 July 2015