Byron Shire Council v MacAdam
[2001] NSWLEC 232
•10/02/2001
Reported Decision: 116 LGERA 418
Land and Environment Court
of New South Wales
CITATION: Byron Shire Council v MacAdam [2001] NSWLEC 232 PARTIES: APPLICANT
RESPONDENT
Byron Shire Council
Nanette Marion MacAdamFILE NUMBER(S): 40125 of 2000 CORAM: Talbot J KEY ISSUES: Costs :- proceedings discontinued by consent following determination of class one proceedings which remedied the continuation of the breach of the law. LEGISLATION CITED: Environmental Planning and Assessment Act 1979 s 82A
Land and Environment Court Act 1979 s 69
Land and Environment Court Rules 1996 Pt 15 r 7CASES CITED: Beilby v Viney Pty Ltd (2001) 113 LGERA 450;
Jan Yee Australia Pty Ltd v Woollahra Council and Anor (Bignold J, NSWLEC, 26 March 1997, unreported);
Oshlack v Richmond River Council (1998) 193 CLR 72DATES OF HEARING: 11/09/2001 DATE OF JUDGMENT:
10/02/2001LEGAL REPRESENTATIVES: RESPONDENT
APPLICANT
Ms L.M. Byrne (Barrister)
SOLICITORS
Elliot & Sochacki
Mr A.I. MacAdam (Agent)
SOLICITORS
N/A
JUDGMENT:
IN THE LAND AND Matter No. 40125 of 2000
ENVIRONMENT COURT Coram: Talbot J
OF NEW SOUTH WALES Decision Date: 2 October 2001
Applicant
Respondent
1. Following the discontinuance of these proceedings by consent, the applicant has moved the Court for orders that the respondent pays the applicant’s costs. Ms Byrne appears for the Byron Shire Council (“the council”). The respondent is represented by her agent, Alistair Ian MacAdam, who is her brother, a Queensland barrister not admitted to practice in New South Wales.
2. On 17 August 2000 the applicant filed a class 4 application. The application was subsequently amended by the filing of an amended class 4 application on 10 November 2000. The applicant requested the Court to make orders restraining the respondent from using the premises, known as Lot 41 DP 714410, 6 Julian Rocks Drive, Byron Bay (“the premises”), for the purposes of a hostel or a bed and breakfast establishment. It also sought interlocutory relief by way of an order restraining the respondent from letting out the premises on a temporary basis and advertising it as being available as a “homestay”.
3. On 15 September 2000 the Court made ex parte interlocutory orders by way of injunction.
4. On 28 November 2000 by consent further interlocutory orders were made by setting aside the orders made on 15 September 2000 and substituting new orders restraining the respondent from letting or using the premises or advertising the premises as available for use as a bed and breakfast facility, a hostel or homestay. Costs were reserved.
5. On 6 April 2001 the Court upheld a class 1 appeal by the respondent against the refusal of a development application by the council. The applicant was seeking consent to use the premises as a bed and breakfast establishment.
6. On 10 July 2001 the parties filed short minutes of orders seeking, inter alia, to discontinue the class 4 proceedings and to discharge the interlocutory orders of the 28 November 2000, except for those orders which set aside the earlier orders of the 15 September 2000. The orders were made by consent. The Court stood over the question of costs for further hearing.
7. Accordingly, the only outstanding matter to be resolved between the parties is costs.
8. It is a well settled practice of the Court that when exercising its discretion, pursuant to s 69 of the Land and Environment Court Act 1979 (“the Court Act”), the Court normally will order that costs follow the event. Success in the action or on particular issues is a fact that usually has determinative weight on the exercise of the discretion.
9. The council is seeking an order pursuant to Pt 15 r 7 of the Land and Environment Court Rules 1996 (“the LEC Rules”) on the basis that the respondent satisfied or caused to be satisfied the claim of the applicant after the proceedings were commenced.
10. Ms Byrne had initially sought to rely upon the test adopted by Sheahan J in Beilby v Viney Pty Ltd (2001) 113 LGERA 450 at 458, following earlier observations made by Bignold J in Jan Yee Australia Pty Ltd v Woollahra Council and Anor (Bignold J, NSWLEC, 26 March 1997, unreported), in an attempt to introduce evidence filed in the course of the proceedings by way of affidavits and correspondence to determine whether “the proceedings were justifiably commenced, justifiably continued, justifiably settled and in all probability would have succeeded … had they been fully litigated”.
11. It is not appropriate for the Court to conduct a defacto hearing as to the merits of the case, when the case is settled, in order to determine which party is to bear the burden of costs. Nevertheless, by consent Ms Byrne was given leave to read an affidavit by the council’s Principal Health and Compliance Officer, Wayne Andrew Bertram, dated 24 November 2000, in reply to an affidavit by Mr MacAdam, dated 10 September 2000 and read by him on behalf of the respondent.
12. In written submissions the applicant claims costs against the respondent on the following grounds:-
- The interlocutory orders were varied but not discharged – therefore the council was successful
- the fact that development consent was granted by the court pursuant to a s34 conference for a B&B [bed and breakfast] subject to strict conditions is further evidence that the council would have been successful;
- the granting of the consent by the court obviated the need for the interim injunctions to be made permanent because the council was satisfied that the respondent’s use of the premises was now governed by the consent and the conditons
13. Ms Byrne relies on the following facts which she submits are relevant to the exercise of the Court’s discretion:-
(2) It was necessary to obtain orders for substituted service on 25 August 2000;(1) The respondent failed to appear before the Court on six occasions;
(3) The respondent failed to comply with a timetable made by the Court with the consent of the parties on 18 October 2000 by not filing points of defence and only filing one affidavit;
(4) The council did not press compliance with the timetable once the class 1 application was filed;
(5) There has been no misconduct in the proceedings by the council;
(6) The council complied with the directions and orders of the Court; and
(7) The council consented to the variation of interlocutory orders, the standing over of the proceedings and a notice to produce, and the discharge of the interlocutory orders.
14. Ms Byrne urges the Court to take into account the conduct of the respondent when exercising its discretion as to costs.
15. Mr MacAdam submits that Pt 15 r 7 of the LEC Rules does not apply as there has been no breach of the law. Furthermore, the totality of the council’s conduct in the proceedings disentitled it to the benefit of a costs order, particularly as the council agreed to discharge the orders.
16. The Court takes account of the observation of McHugh J in Oshlack v Richmond River Council (1998) 193 CLR 72 at 97 - 98, as follows:-
Thus, the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation; unnecessarily protracts the proceedings; succeeds on a point not argued before a lower court; prosecutes the matter solely for the purpose of increasing the costs recoverable; or obtains relief which the unsuccessful party had already offered in settlement of the dispute.
17. The respondent relies upon five letters exhibited to the Court and annexed to the affidavit of Mr MacAdam to establish the misconduct by the council.
18. In response to a formal letter of complaint from Mr MacAdam, written on behalf of the respondent, Ms Nanette MacAdam, dated 12 January 2001, the General Manager of the council in a letter dated 9 March 2001 stated that, as a result of a report which investigated the complaint, “steps are being taken to improve certain procedures in the Local Approvals area”. The writer also apologised “for the management of the issue, with particular reference to the delay in determining the application”. In another letter, dated 29 March 2001, the General Manager claims that the report of an investigation into “the conduct of the behaviour of a Council officer” is in her opinion privileged and therefore only a copy of the recommendations from the report is enclosed for inspection.
19. Mr MacAdam says that the letters from the General Manager are to be read and understood in the context of the letter of complaint, in which a number of claims were made regarding the council’s conduct. He states that the council agreed to engage in alternative dispute resolution and that the proceedings would be adjourned for that reason.
20. He also says that the respondent was told by Mr Bertram that she would not be required to appear in the Court as the parties were only seeking an adjournment. Instead, according to Mr MacAdam, the council proceeded to obtain interim orders in the absence of the respondent.
21. Furthermore, the council rejected a request for a review of the determination of the development application, pursuant to s 82A of the Environmental Planning and Assessment Act 1979 (“the EP&A Act”), nearly six and a half months after the application was made on the basis that the application was not accompanied by the prescribed fee. He submits that modern standards of communication demand that the council notify an applicant that payment of a fee is required. Nonetheless, he says that half of the prescribed fee was subsequently lodged with the council by the respondent’s planning consultants, Chris Lonergan and Associates. The application for reconsideration was rejected on 14 November 2000. The notification for rejection was accompanied by a refund of the money paid and a request for payment of the full fee.
22. The respondent then submitted to the council that the application for reconsideration should not have been rejected. It is claimed by Mr MacAdam that one council officer agreed. However, according to Mr MacAdam the council nevertheless confirmed the rejection of the application for review.
23. The above chronicle of events is taken from copies of correspondence written by Mr MacAdam and annexed to his affidavit.
24. Mr MacAdam also complained that the council issued a widely drafted notice to produce which, although challenged by the respondent, remained untested as a consequence of the discontinuance of the proceedings.
25. Further claims about the council’s conduct are made in the letter of complaint in respect of the issue of a search warrant, the council’s disparaging remarks about the respondent’s planners, Chris Lonergan & Associates, an application for a building certificate, the timetabling for dealing with the reconsideration application and the council officers manners and organisation.
26. In another letter addressed to the council’s solicitors on 26 November 2000, Mr MacAdam made further complaints about the conduct of the council. In that letter the respondent agreed to have the original interim orders varied.
27. Mr MacAdam says that it is important, when determining whether costs should be awarded, to have regard to what the council actually achieved. He submits that nothing was done by the respondent that satisfied the applicant’s claim. The respondent sought approval for a bed and breakfast or hostel and the use of the premises as a bed and breakfast was approved.
28. The respondent submits that the grounds for refusal were spurious because Commissioner Brown determined the development application by approving consent for the use of the premises as a bed and breakfast at a s 34 conference held, pursuant to the Court Act, in the council chambers.
29. Furthermore, once the class one proceedings were determined, consent orders in the class 4 proceedings were agreed upon whereby interlocutory orders were discharged and the proceedings discontinued. Negotiations to reach the final stage took three months.
30. Ms Byrne submits that the letters annexed to the affidavit of Mr MacAdam are only matters of opinion and cannot be relied upon as facts that form the basis for a claim of disentitling conduct.
31. In an affidavit Mr Bertram told the Court that the request for the review, pursuant to s 82A of the EP&A Act, had not been processed because the prescribed fee had not been paid. There is no authority or evidence to confirm that a council is required to notify an applicant that a fee is payable. Section 82A of the EP&A Act, itself, specifies that “The prescribed fee must be paid in connection with a request for a review”. The upholding of an appeal to the Court against the refusal of a development application by a council is not necessarily to be regarded as evidence of misconduct or discrimination.
32. Ms Byrne submits there is no evidence that excuses the conduct of the respondent. The applicant’s claim for interlocutory relief and the orders that followed were made on the basis that the respondent was using the premises as a bed or breakfast or hostel without consent. Until the class 1 proceedings were determined the interlocutory orders made by the Court satisfied the applicant’s claim in respect of the class 4 application. The respondent’s success in the class 1 proceedings resulted in the council agreeing to discharge the interlocutory orders and discontinue proceedings. In the meantime the council was clearly justified in commencing and maintaining the proceedings. The development application has only since been approved by the Court, subject to conditions.
33. Although there may be faults on both sides relating to the resolution of this dispute, the first question the Court must address is whether the council was successful in causing the respondent to satisfy the claim made against her. That is clearly the case.
34. The second question to be determined is whether there was any disentitling conduct on the part of the council. There is no direct evidence that the council obtained relief which the respondent had already offered before or during the continuation of the proceedings. The complaints raised by Mr MacAdam arise out of the development application process which was triggered as a consequence of the commencement of the class 4 proceedings. The development application process resulted in orders being made in class 1 proceedings.
35. Any alleged misconduct by the council in the course of the consideration and processing of the development application or in the class 1 proceedings is not a matter relevant to the issue of costs in the class 4 proceedings. Even if the allegation that the council did not participate in alternative dispute resolution procedures is accepted the suggestion did not, in any event, arise until after the class 4 proceedings were commenced. Furthermore, Mr Bertram has sworn that “at no time did I ever tell or indicate to the Respondent that council would desist from the injunctive proceedings”.
36. The Court is satisfied that in the circumstances, having regard to the evidence before it, the council is entitled to an order for the payment of its costs by the respondent on the basis that the respondent satisfied the claim of the council by obtaining development consent for the use the subject of the alleged breach.
37. The Court makes the following formal orders:-
(2) The exhibits will be retained.(1) The respondent is ordered to pay the applicant’s costs of the proceedings including the hearing on 11 September 2001.
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