Coastal Ecology Protection Group Inc v City of Charles Sturt - [2020] SASC 215

Supreme Court of South Australia
(Civil: Application)
COASTAL ECOLOGY PROTECTION GROUP INC & ANOR v CITY OF CHARLES STURT
[2020] SASC 215
Ruling of The Honourable Justice Livesey (ex tempore)
14 October 2020
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS
The respondent sought the summary dismissal or striking out of part or all of the proceedings commenced against it by the applicants. As commenced, the proceedings challenged the respondent’s 2018 public consultation policy. The applicants later sought permission to amend the proceedings to incorporate a challenge to the respondent’s 2020 public consultation policy.
After hearing full argument, judgment was reserved, although argument about the question of permission to amend was deferred to allow the parties time to confer regarding the adequacy of the applicants’ amended statement of grounds. Before judgment was delivered, however, the parties advised the Court that they were in agreement that the respondent’s application should be dismissed and the applicants’ application to amend should be granted. The sole question remaining for the Court concerned the costs of the applications.
Held:
1. The costs associated with the amendment application should be costs in the cause, on the basis that the applicants' amendment was made in response to the respondent's introduction of the 2020 public consultation policy and is akin to the commencement of a new action.
2. The applicants must meet the respondent's costs associated with the further revision and particularisation of the applicants' pleading on two occasions between 9 September and 7 October 2020.
3. The respondent must pay the costs of the application for, and hearing of, the summary dismissal or strike out application on the basis that the respondent capitulated only following a full hearing on 15 September 2020.
4. Certified fit for senior counsel.
5. There will be no order for costs on the costs hearing.
Associations Incorporation Act 1985 (SA); Local Government Act 1999 (SA), s 8, s 50, s 302B; South Australian Public Health Act 2011 (SA), s 87; Supreme Court Act 1935 s 40; Uniform Civil Rules 2020 (SA), r 194.5, r 194.4, referred to.
A Team Diamond Headquarters Pty Ltd v Main Road Property Group Pty Ltd (2009) 25 VR 189; Alstom v Yokogawa Australia Pty Ltd (No 9) [2012] SASC 163; ASC v Aust-Home Investments Ltd (1993) 116 ALR 523; Bowen Energy Ltd v 2KD Drilling Pty Ltd [2012] FCA 275; Coastal Ecology Protection Group Inc v City of Charles Sturt [2017] SASC 136; Commonwealth of Australia v Lion [2004] FCAFC 92; Cretazzo v Lombardi (1975) 13 SASR 4; Golski v Kirk (1987) 14 FCR 143; Kiama Council v Grant (2006) 143 LGERA 441; Main Road Property Group Pty Ltd v Pelligra and Sons Pty (No 2) [2009] VSC 174; Mullet v Gabriel (1989) 52 SASR 330; One.Tel Ltd v Commissioner of Taxation (2000) 101 FCR 548; Oshlack v Richmond City Council (1998) 193 CLR 72; Pope v Harris Orchards [2010] SASC 354; Re Minister for Immigration and Ethnic Affairs (Cth); ex parte Lai Qin (1997) 186 CLR 622; Rupcic v A W Baulderstone Pty Ltd (1987) 46 SASR 99; Yates Property Corporation Pty Ltd v Boland (2000) 179 ALR 664, considered.

COASTAL ECOLOGY PROTECTION GROUP INC & ANOR v CITY OF CHARLES STURT
[2020] SASC 215
Civil
LIVESEY J:
Introduction

On 20 August 2020, the respondent sought the summary dismissal or striking out of part or all of the proceedings commenced against it by the applicants in 2018. As commenced, those proceedings challenged the respondent’s 2018 public consultation policy.
Earlier, on 28 July 2020, the applicants sought permission to amend the proceedings to incorporate a challenge to the respondent’s 2020 public consultation policy.
These matters were listed for argument over the course of one day on 15 September 2020. Judgment was reserved, with an indication that a decision would be delivered on 30 September 2020. At the request of the parties, argument about the question of permission to amend was deferred to allow them to confer about the adequacy of a revised Second Statement of Grounds — Revision 1 given on 14 September 2020.
On 30 September 2020, the Court was advised that the parties were agreed that the respondent’s application should be dismissed and the applicants’ application should be granted.
The only matter remaining to be addressed arising out of those applications concerns costs. Accordingly, these reasons only address the costs of the application for summary dismissal or striking out, as well as the application to amend, which was argued today.
Disposition of the costs questions
In my opinion, the following orders should be made:
1The costs of the applicants’ initial application to amend dated 28 September 2020 are to be costs in the cause.
2The costs of the applicants’ application to amend insofar as it concerned the revised Second Statement of Grounds — Revision 1 between 9 September 2020 and 7 October 2020 are to be the respondent’s costs on the standard basis.
3The costs of the respondent’s application for, and hearing of, summary dismissal or striking out are to be the applicants’ costs on the standard basis.
4I certify fit for senior counsel.
5There will be no order for costs for today’s hearing.
The parties
The first applicant is an association incorporated under the Associations Incorporation Act 1985 (SA). It has over 100 households as members and operated informally before its incorporation in 2001. The second applicant, Dr Packer, owns beachfront property at Tennyson, within the respondent Council’s area of operation.
The applicants claim an interest in decisions made by the respondent which, they say, has necessitated consultation with them. Dr Packer says that she has regularly made submissions to Council in her role as a member of the first applicant. This has extended across a range of issues “particularly on matters to do with coastal preservation and protection”.[1]
[1] Affidavit of Lorimer Judith Packer sworn 20 December 2018, paragraph [6].
This matter comes before the Court following a failed mediation and public statements by the State Government of its intention to utilise the Linear Parks Act 2006 (SA) to undertake consultation in relation to a proposed linear park in lieu of what has been described as a “Coast Park Path”.
The Government has announced that the proposed linear park will comprise two stages. Only stage one is the subject of formal notification. That portion of the path that lies within the respondent’s boundary is within stage two and is not yet the subject of any formal notification. Nonetheless, the respondent submits that there is no utility in conducting any consultation over the Coast Park Path because the matter is now in the hands of the State Government.
The earlier proceedings, the 2018 and 2020 policies
In earlier proceedings between the same parties, Blue J held that decisions concerning a proposed Coast Park Path were made by the respondent in breach of its 2015 public consultation policy.[2] Following those proceedings the respondent reviewed its public consultation policy “with a view to enabling the completion of the Coast Park Path”.[3]
[2] Coastal Ecology Protection Group Inc v City of Charles Sturt [2017] SASC 136. This decision sets out the background to the present dispute at some length.
[3] Affidavit of Lorimer Judith Packer sworn 20 December 2018, paragraph [15].
This resulted in the public consultation policy published in 2018. The applicants contend that the respondent was obliged to consult in accordance with its existing 2015 policy if it wished to alter that policy, but did not do so. They also contend that the 2018 public consultation policy does not comply with ss 8 and 50 of the Local Government Act 1999 (SA) (the Local Government Act).
On 15 March 2020 a public health emergency was declared concerning the COVID-19 pandemic under s 87 of the South Australian Public Health Act 2011 (SA).
Following the introduction of s 302B to the Local Government Act in March this year,[4] the relevant Minister was authorised to vary or suspend the operation of specified provisions of that Act by a notice in the Gazette following the declaration of a public health emergency, provided the relevant Minister was satisfied that the variation or suspension was “reasonably necessary” as the result of the emergency.
[4] Inserted by 3/2020, s 3, operative 26 March 2020.
On 8 April 2020 the relevant Minister then issued a notice pursuant to s 302B of the Local Government Act which, amongst other amendments, amended s 50 of the Local Government Act as follows:
50—Public consultation policies
(1)     For the purposes of this Act, a council must prepare and adopt a public consultation policy.
(2)     A public consultation policy—
(a)must set out steps that the council will follow in cases where this Act requires that a council must follow its public consultation policy; and
(b)may set out steps that the council will follow in other cases involving council decision-making.
(3)     The steps referred to in subsection (2)—
(a)in a case referred to in subsection (2)(a)—must provide interested persons with a reasonable opportunity to make submissions in the relevant circumstances; and
(b)may vary according to the classes of decisions that are within the scope of the policy.
(4)     However, a public consultation policy for a case referred to in subsection (2)(a) must at least provide for—
(a)     the publication of a notice—
(i)    in a newspaper circulating within the area of the council; and
(ii)     on a website determined by the chief executive officer,
describing the matter under consideration and inviting interested persons to make submissions in relation to the matter within a period (which must be at least 21 days) stated in the notice; and
(b)the consideration by the council of any submissions made in response to an invitation under paragraph (a).
(5)     A council may from time to time alter its public consultation policy, or substitute a new policy.
(5a)   For the purposes of this section, a council may alter its public consultation policy or substitute a new policy without undertaking public consultation, even if the existing public consultation policy requires the council to conduct public consultation.
~~(6)     However, before a council—~~
~~(a)     adopts a public consultation policy; or~~
~~(b)     alters, or substitutes, a public consultation policy,~~
~~the council must—~~
~~(c)prepare a document that sets out its proposal in relation to the matter; and~~
(d)publish in a newspaper circulating within the area of the council a notice of the proposal inviting interested persons to make submissions on the proposal within a period (which must be at least one month) stated in the notice; and
~~(e)consider any submissions made in response to an invitation under paragraph (d).~~
(7)     A council is not required to comply with subsection (6) in relation to the alteration of a public consultation policy if the council determines that the alteration is of only minor significance that would attract little (or no) community interest.
(8)     A person is entitled to inspect (without charge) a public consultation policy of a council at the principal office of the council during ordinary office hours.
(9)     A person is entitled, on payment of a fee fixed by the council, to a copy of a public consultation policy.
The passage that is underlined has been added. The operation of the passage that has been struck through has been suspended.
So as to better understand the arguments made before me, it is helpful at this point to highlight that various of the matters addressed by s 50 can be categorised as either mandatory or discretionary.
Examples of mandatory obligations are provided by ss 50(2)(a), 50(3)(a), 50(4)(a) and 50(4)(b) of the Local Government Act. The combined effect of these provisions is that a public consultation policy must “set out the steps” that the council will follow in cases where the Act requires that a council follow its public consultation policy. The policy must also provide interested persons with “a reasonable opportunity to make submissions” in the relevant circumstances. In addition, those steps must at least provide for “the publication of a notice” (essentially a public invitation which complies with ss 50(4)(a)) and for “the consideration by the council of any submissions made” in response to that notice or invitation.
Whether these provisions were complied with by the respondent in 2018 forms part of the dispute between these parties.
Examples of discretionary matters are provided by ss 50(2)(b), 50(3)(b), 50(5) and, now, s 50(5a) of the Act. The breadth of this last-mentioned provision also forms part of the dispute between these parties.
During April 2020, the respondent substituted a 2020 public consultation policy for its 2018 policy. This was done without community consultation. The applicants contend that this substitution did not represent a lawful exercise of the power conferred by s 50(5a) of the Local Government Act.
The applicants contend that, insofar as changes to the 2018 policy reflected in the new 2020 policy go beyond what is required by the pandemic, it remains the case that the mandatory requirements laid down by s 50(3) of the Local Government Act must be observed.
However, the respondent contends that there is no utility in litigating the issues concerning the 2018 policy because it has been replaced by the 2020 policy.
The affidavit evidence before the Court
I have received, without objection, and considered the following material:
1      Affidavit of Lorimer Judith Packer affirmed 20 December 2018;
2      Affidavit of Thomas Launcelot Crompton sworn 20 December 2018;
3      Second affidavit of James Lyell Roder sworn 28 July 2020;
4      Affidavit of Bruce Williams sworn 19 August 2020;
5      Affidavit of Anthony Kelly sworn 11 September 2020;
6      Affidavit of Paul Sutton sworn 11 September 2020; and
7      Third affidavit of James Lyell Roder sworn 14 September 2020.
The costs principles
The costs principles to be applied are set out in rule 194.5 of the Uniform Civil Rules 2020 (SA) which, together with s 40 of the Supreme Court Act 1935 (SA), confers a wide discretion which must be exercised judicially and on grounds connected with the litigation.[5]
[5] Cretazzo v Lombardi (1975) 13 SASR 4 and Oshlack v Richmond City Council (1998) 193 CLR 72.
By sub‑rule 194.5(2) the “general costs rule” is that “costs follow the event”. That general costs rule is subject to what are described as the “presumptive costs rules” set out in rule 194.4. There, to the extent that the Court “does not otherwise order”, and insofar as is relevant to the matter argued before me, those presumptive rules are:
1That the costs of an amendment are to be paid by the party making the amendment, rule 194.4(2); and
2That, subject to sub‑rules (2) and (3), the costs of an interlocutory application are to be costs in the cause, rule 194.4(5).
The width of the discretion regarding the operation of these presumptive rules are made clear by r 194.5(1) because, here again, they are subject to the extent that the Court might “otherwise order”.
The costs of the amendment
Whilst the parties agree that the applicants must normally meet the costs of their application to amend, the applicants contend that the need for amendment was brought about by the decision of the respondent to implement the 2020 public consultation policy. The applicants contend that this was done so as to defeat their challenge to the 2018 public consultation policy.
Accordingly, the applicants contend that this is a case where the presumptive costs rule should not be applied. They also invoke the propositions that the presumptive costs rule should not be applied to a pleading akin to the commencement of an action nor should it be applied in the face of an unsuccessful attempt to oppose the application for permission to amend.[6]
[6] Alstom v Yokogawa Australia Pty Ltd(No 9) [2012] SASC 163 (Bleby J).
For its part, the respondent accepts that the costs of amending proceedings, so as to incorporate a challenge to the 2020 public consultation rule, are akin to the costs incurred on the institution of proceedings, with the result that costs would ordinarily “follow the event”.[7] Whilst that would ordinarily require that the costs be ordered to be “in the cause”, and await the outcome of at least this aspect of the action, the respondent submits that these principles do not apply to an amendment that does not meet the requirements of the rules as to pleading. The respondent contends that the applicants must pay the costs associated with the preparation and promotion of a defective pleading, namely, one that required better particularisation.[8] Accordingly, the respondent contends that the applicants have sought an indulgence and must pay the costs associated with obtaining permission to amend in the form in which it was finally made.[9]
[7]    Mullet v Gabriel (1989) 52 SASR 330 (O’Loughlin J).
[8]    Rupcic v A W Baulderstone Pty Ltd (1987) 46 SASR 99 and Pope v Harris Orcards [2010] SASC 354, [24] (White J).
[9]    Golski v Kirk (1987) 14 FCR 143; Bowen Energy Ltd v 2KD Drilling Pty Ltd [2012] FCA 275, [22].
In my view, neither of these arguments should be wholly accepted. It is true that the initial application to amend was brought about by the introduction of the 2020 public consultation policy. In that sense, the applicants were not seeking an indulgence and were acting in a manner akin to the commencement of a fresh proceeding. The costs associated with that part of the amendment application should be costs in the cause.
However, the fact that the proposed amendment required revision and particularisation on two occasions is a matter for which the applicants should meet the respondent’s costs.
These aspects of the application to amend were not actually required to be argued. Rather, they were the subject of competing contentions in correspondence and took up little or no time on 15 September 2020.
Costs of the summary dismissal application
The applicants accept that where the court has not delivered judgment the authorities are generally to the effect that there has been no “event” and that the presumptive principle is that no costs are ordered, or perhaps here that the costs will be in the cause.[10]
[10] ASC v Aust-Hone Investments Ltd (1993) 116 ALR 523, 530 (Hill J), Re Minister for Immigration and Ethnic Affairs (Cth); Ex parte Lai Qin (1997) 186 CLR 622.
However, though the applicants accept that the court would not usually conduct a hypothetical determination for the purposes of determining costs, and instead look to whether the parties have at all times acted reasonably, they say this case is different because the court has heard all of the requisite arguments and considered the evidence and was expected to deliver judgment. The applicants rely upon what was said in Yates Property Corporation v Boland by Goldberg J:[11]
Although it is open to me on the authorities to which I have referred to determine the costs issues by reference to the reasonableness of the conduct of the parties in relation to the amendment application, I consider, in the circumstances of this case, that I should determine the costs issue by reference to the outcome of the application in respect of which I have been able to form a concluded considered view.
[11] Yates Property Corporation Pty Ltd v Boland (2000) 179 ALR 664, [7] (Goldberg J).

The applicants emphasise that this approach has been cited with approval.[12]
[12] Main Road Property Group Pty Ltd v Pelligra and Sons Pty Ltd (No 2) [2009] VSC 174, upheld on appeal in A Team Diamond Headquarters Pty Ltd v Main Road Property Group Pty Ltd (2009) 25 VR 189, and Commonwealth of Australia v Lion [2004] FCAFC 92 (regarding an injunction application).
The respondent contests this approach, emphasising that its application targeted the initial proposed amended pleading, not the later amended pleadings. In addition, the respondent says that the initial proposed amended pleading drew no explicit link between the challenge to the 2018 public consultation policy and the 2020 public consultation policy and that this was only made clear by the final version of the amended pleading.
The respondent says that it acted properly in accepting that the fate of the later amended proposed pleading could not be determined summarily. It submits that the ordinary position should apply, namely, that where an issue has been litigated but not determined, no order for costs should be made.[13]
[13] Re Minister for Immigration and Ethnic Affairs; Ex parte Li Qin (1997) 186 CLR 622.
Whilst the respondent accepts that this principle is subject to exceptions, it says they do not apply. It says those exceptions, insofar as is relevant, are: (1) where a party effectively capitulates or surrenders, and (2) where a supervening event so alters the subject of the dispute that no issue remains, save for costs.[14] In the case of a “surrender”, the costs order will usually be made against the party that “surrenders”. In the case of a supervening event, ordinarily no costs order should be made.
[14] One.Tel Ltd v Commissioner of Taxation (2000) 101 FCR 548, [6] (Burchett J) and Kiama Council v Grant (2006) 143 LGERA 441.
Notwithstanding these submissions, the respondent contends that it should have its costs of the application because it abandoned the application only following receipt of the third iteration of the proposed amended pleading on 22 September 2020. It says this was, in turn, drafted in response to the respondent’s outline on 11 September 2020 and effectively represented a “capitulation” by the applicants on the argument mounted by the respondent. In other words, the respondent says that it abandoned its application only because the applicants tacitly accepted that the respondent was correct and the applicant needed to make further amendments to meet the respondent’s contentions made on 15 September 2020.
As for whether the approach taken by Goldberg J in Yates v Boland should be applied, the respondent submits that it “does not know how well advanced the Court is in the preparation of reasons” and that it “does not wish to make presumptuous submissions”.
In my opinion, the respondent should pay the applicants’ costs of the summary dismissal and strike out application.
Whatever might be said about the state of play at the time of the initial pleading in July, by the time the hearing before me on 15 September, it should have been clear that the applicants were pressing complaints about both the 2018 and 2020 public consultation policies.
In my view, this is a case where the consequence of capitulation after a full hearing warrants an adverse order for costs. It is significant that, insofar as the respondent contends that before the commencement of the hearing it was not apprised of the applicants’ position about the 2018 policy, the 2018 policy was always the subject of challenge. That was so regardless of the later amended pleading which introduced a challenge to the 2020 policy.
In the circumstances, I need not dwell upon what the position might have been had the capitulation occurred before the hearing on 15 September, nor need I go so far as to articulate in explicit terms the findings I might have made but for the capitulation on the application. I think it is inappropriate to do so where the trial will now proceed before a different Judge.
Other matters
When the parties sought to resolve their respective applications on 30 September, they sought an early date for trial. As it turns out, I had already been allocated another matter for hearing on the date nominated by the parties. Nonetheless, the Court has been able to accommodate their request by allocating the Honourable Justice Blue for the hearing on 14 December 2020.
Conclusion
The costs of the initial application to amend are to be costs in the cause, the applicants must pay the costs of the application to amend in terms of the revised pleadings, and the respondent must pay the applicants’ costs of the summary dismissal and strike out application heard before me on 15 September 2020.