Coastal Ecology Protection Group Inc v City of Charles Sturt (No 2) - [2017] SASC 152

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application for Judicial Review)
COASTAL ECOLOGY PROTECTION GROUP INC & ORS v CITY OF CHARLES STURT (NO 2)
[2017] SASC 152
Judgment of The Honourable Justice Blue
26 October 2017
PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT - COSTS OF WHOLE ACTION - GENERALLY
Application for costs of action.
The plaintiffs were successful in the action in obtaining declaratory and injunctive relief in respect of decisions by the defendant: [2017] SASC 136.
The plaintiffs seek an order that the defendant pay their costs of action. The defendant contends that it should only pay 70 per cent of the plaintiff's costs because the plaintiffs unnecessarily and unreasonably adduced expert evidence and the plaintiffs did not succeed on all issues.
Held:
1. There is no reason to reduce the plaintiffs' costs to be paid by the defendant by reason of the adducing of expert evidence (at [12]).
2. Consideration of the factors affecting whether the discretion should be exercised to make a costs order reflecting mixed success on issues (at [17] - [18]).
3. It is appropriate to order that the defendant pay 90 per cent of the plaintiffs' costs to reflect the mixed success of the parties on the issues (at [25]).
A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27, discussed.

COASTAL ECOLOGY PROTECTION GROUP INC & ORS v CITY OF CHARLES STURT (NO 2)
[2017] SASC 152
Civil
BLUE J:

This is an application by the successful plaintiffs for an order that the defendant pay their costs of the action.
On 21 September 2017 I delivered reasons for judgment finding that the plaintiffs Coastal Ecology Protection Group Incorporated, Dr Packer and Professor Howie were entitled to declaratory and injunctive relief in respect of decisions by the defendant City of Charles Sturt (the Council) to adopt a community land management plan (the management plan decision) in respect of coastal land under its control and to construct a shared–use path longitudinally through part of that coastal land (the path decisions).[1]
[1] Coastal Ecology Protection Group Incorporated & Others v City of Charles Sturt [2017] SASC 136.
The plaintiffs seek an order that the Council pay their costs of the action. The Council contends that it should only pay 70 per cent of the plaintiffs’ costs of action because the plaintiffs unnecessarily and unreasonably adduced expert evidence and the plaintiffs did not succeed on all issues.
Expert evidence
The Council contends that none of Dr Semeniuk’s evidence assisted the plaintiffs in succeeding on the grounds on which they succeeded and the evidence did not therefore meet the threshold test for relevance: the only ground on which Dr Semeniuk’s evidence had some relevance was the dedications ground upon which the plaintiffs failed and in any event it was directed to a concrete path through the dunes which was not proposed by the Council.
The Council draws attention to passages in my principal reasons in which I observed that the plaintiffs adduced the expert evidence for limited purposes and the residual differences between the opinions of the expert witnesses by the end of the concurrent evidence were small and did not impact on my decision.
The Council draws attention to my identification of the relevance of the expert evidence as being that it provided a factual background against which to consider the impugned actions of the Council, enabled me better to understand the other evidence that was tendered and addressed objective matters in the event that it should prove necessary for the Court to determine any matters on an objective basis. The Council relies on my observation that it ultimately transpired that matters of factual background were generally proved by documents or were common ground, information that might have been provided to the Council was generally evident from documents tendered and there was limited call for me to determine objective matters such as consistency with the dedications.
The plaintiffs contend that they ought not be deprived of their costs because or to the extent that they adduced expert evidence. They point to the fact that the Council did not object to the admission of Dr Semeniuk’s evidence on the ground that it was irrelevant, the Council adduced extensive expert evidence of its own from two experts, the Council cross-examined Dr Semeniuk on his evidence at length during the trial and the Council made submissions in closing address on the merits of the expert evidence. The plaintiffs submit that the question whether it was unnecessary or unreasonable to adduce the expert evidence must be tested at the time and not with the wisdom of hindsight as to how the Council ultimately conducted the trial and how the issues were ultimately determined by the trial Judge.
I reject the Council’s contention that the plaintiffs should not recover the costs of adducing expert evidence. The question whether it is necessary or reasonable to obtain or lead expert evidence is to be determined at the time the evidence is obtained or given and not retrospectively after judgment.
The expert evidence greatly assisted me in understanding the background to and factual issues in the case. With the benefit of that expert evidence, it was possible for me to say by the end of the trial that matters of background were generally proved by documents but without the benefit of that expert evidence to assist in understanding those documents it would not have been possible to make that observation. By the end of the trial it was possible for me to say that many matters were common ground but this was not the case when Dr Semeniuk prepared his report, when he commenced giving evidence and in some cases even when he concluded giving evidence. The same observations apply to the expert evidence insofar as it addressed and enabled me to understand the information and advice that was available to the Council.
My observation that there was limited call for me to determine objective matters such as consistency with the dedications was made only after closing address. As in many cases, this case was dynamic and the issues evolved and emerged during the trial, only being finally identified or clarified by the end of the closing addresses. Even by the end of closing addresses, the expert evidence was still relevant to the first major issue whether the path decisions were contrary to the management plan. It was also relevant to the issue whether the 2016 path decision was contrary to the dedications.
It is theoretically conceivable that a party might be deprived of costs on the ground that it was unnecessary or unreasonable to adduce expert evidence notwithstanding that the opponent did not object to its admission, adduced detailed evidence in response, cross-examined the expert at length and made submissions in closing address inviting the Court to prefer the evidence given by its own experts over the evidence given by the expert called by the successful party but that will be a rare case. This case is not such a case.
I reject the Council’s contention that the plaintiffs should be deprived of a proportion of the costs of the action on account of the costs incurred in respect of expert evidence.
The Council made a separate challenge to the quantum of costs incurred by the plaintiffs by way of disbursement in engaging Dr Semeniuk to prepare his report. This challenge was the subject of a compromise resolution between the parties and I will make an order reflecting that resolution.
Mixed success
The Council submits that the costs of action ordered in favour of the plaintiffs should be reduced because the plaintiffs failed on the issue of the dedications, being one of the major issues in the case.
The plaintiffs contend that the Court should not be too ready to deprive a successful party of costs merely because it failed on one issue and the Court ought not to do so in the present case because amongst other things the plaintiffs succeeded on the sub-issue whether section 18 of the Crown Land Management Act 2009 (SA) imposed a duty to comply with a dedication and this sub-issue occupied the great majority of the time devoted to the dedications issue.
The Council accepts that in the circumstances the Court has a discretion to consider costs at the level of sub-issues but submits that the discretion should not be exercised or alternatively that, if this is undertaken, consideration should also be given to the Council’s success on sub-issues on which it succeeded even though it failed on the issues to which the sub-issues related.
In A, DC v Prince Alfred College Inc (No 2),[2] the Full Court said:
[2] [2016] SASCFC 27.
The principles governing the exercise of the costs discretion are well established. The Court exercises a judicial discretion with respect to costs in which the general rule is that costs ordinarily follow the event unless there are special circumstances justifying another order. In more recent times, courts more readily modify the general rule recognising that the interests of justice sometimes require a reduction in the costs that would otherwise have been awarded to a successful party when that party has failed on particular disputed questions of fact or law. In Ruddock v Vardalis (No 2), Black CJ and French J summarised the principles as follows:
Within the general discretion of the courts to award costs it is accepted by decisions in both Australian and English jurisdictions that:
·    Ordinarily costs follow the event and a successful litigant receives costs in the absence of special circumstances justifying some other order.
·    Where a litigant has succeeded only upon a portion of the claim, the circumstances may make it reasonable that the litigant bear the expense of litigating that portion upon which he or she has failed.
·    A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other parties' costs of them. In this sense “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or law.
The modification of the ordinary rule to reflect the way in which particular issues in the litigation are determined is a response to those ‘cases in which issues are raised which unduly extend the time and expense of litigation’.
In Victoria and Master Builders Association of Victoria Ormiston JA explained that in an era of high cost litigation it had become necessary to more often allocate costs according to success on particular issue because ‘regrettably there are many cases in which issues are raised which unduly extend the time and expense of litigation’. Those observations were echoed in Mickelberg v Western Australia by Newens J who referred also to ‘the burdens imposed on the public resources of the Court’ by parties pursuing claims on which they are ultimately not successful.
Just as parties must make a cost benefit and risk analysis decision on whether to bring an action at all, so too must decisions be made about which claims to include within an action. Parties should not be encouraged to add to a claim which has sufficient prospects, in itself, to justify the bringing of an action other claims, of doubtful merit, on the assumption that the costs of pursuing the latter claims will be recovered because of success on the good claim.
In adversarial litigation the parties and their legal advisors carry the primary responsibility for ensuring the cost-effectiveness of litigation because they have a particular knowledge and understanding of the controversy, and the available evidence, which the court cannot know because of legal professional privilege.
It is therefore the responsibility of the legal profession to actively consider the affect of adding doubtful claims, or mounting defences to good claims without any foundation for doing so, on the efficient resolution of the proceedings. In accordance with that duty legal practitioners must give advice on the relative merits of the possible claims and defences and on the cost and time implications of pursuing those claims so that the litigant is in a position to give informed instructions on how to conduct the proceedings.
The authorities to which we have referred make it clear that the rule does not only apply to a ‘precise issue in the technical pleading sense’ but extends to any substantial disputed question of fact or law. There is of course a limit to the dissection of an action which is practicably possible.
On the other hand, the court should not be overly parsimonious in the award of costs to a plaintiff who has won a judgment against a wrongdoer who has denied liability on all of the grounds of the plaintiff’s claim.
There can be no precision in the balancing of the tension between the ordinary rule and its qualification. Much will depend on the extent to which the costs of the litigation of the separate issues can easily be separated out and on the reasonableness of the forensic decision of the successful party to pursue, not only the claims on which he or she succeeded, but also those claims on which he or she failed.[3]
[3]    At [5]-[13] per Kourakis CJ, Gray and Peek JJ. (Citations omitted)
Without limiting the factors relevant to the exercise of the discretion, it is more likely to be exercised to make a costs order reflecting mixed success on issues:
·    the more separate and distinct the issue on which the successful party failed (a separateness assessment);
·    the greater the proportion of costs of the issue on which the successful party failed out of total costs (a relativity assessment);
·    the greater the costs of the issue on which the successful party failed (an absolute assessment);
·    the less the merit of the successful party’s case on the unsuccessful issue (a merit assessment).[4]
[4]    See Australian Trade Commission v Disktravel [2000] FCA 62 at [3] per French, Kiefel and Mansfield JJ; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [3]-[6] per Finkelstein and Gordon JJ.
In the present case, I consider that I should exercise my discretion to reduce the costs of action to be paid by the Council on account of the fact that the plaintiffs did not succeed on all issues. On the one hand, it cannot be said that the plaintiffs’ claim based on the dedications lacked merit because they would have succeeded in that claim if I had not distinguished the decision of the New South Wales Court of Appeal in Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (Goomallee Claim).[5] There was an overlap between the evidence relevant to the dedications issue and the evidence relevant to the issues on which the plaintiffs succeeded. On the other hand, the dedications issue was otherwise relatively separate and distinct from the other issues and the costs incurred in respect of the dedications issue were not insignificant in both an absolute and relative sense.
[5] [2012] NSWCA 358; (2012) 84 NSWLR 219.
However, I also consider that I should exercise my discretion to reflect the fact that the sub-issue which occupied the great majority of the time in relation to the dedications issue was whether section 18 of the Crown Land Management Act 2009 (SA) imposed a duty to comply with a dedication and the plaintiffs succeeded on this sub-issue. A relatively small proportion of time was devoted to the sub-issues of the appropriate test for compliance and whether use of the land for a coastal path was inconsistent with the dedications purposes. If the appropriate test had been furtherance, the plaintiffs would have succeeded on the test whether use of the land for a coastal path was in furtherance of the dedications purposes.
Having taken into account sub-issues in relation to the issue on which the Council succeeded, I accept the Council’s submission that I should also take into account sub-issues in relation to the issues on which the plaintiffs succeeded.
The plaintiffs succeeded on all sub-issues in relation to the issues of:
·    compliance of the path decisions with the management plan;
·    unlawfulness of the management plan by reference to public consultation;
· validity of the management plan by reference to section 196 of the Local Government Act 1999 (SA); and
·    unlawfulness of the path decisions by reference to public consultation.
In relation to the issues of material considerations in respect of the management plan and path decisions, the plaintiffs succeeded on the sub-issue of failing to have regard to mandatory considerations but failed on the sub-issues of having regard to impermissible considerations and proceeding under a misunderstanding. The great majority of time spent on material considerations was devoted to mandatory considerations as opposed to impermissible considerations and misunderstandings.
In relation to mandatory considerations, the plaintiffs succeeded in respect of environmental protection. The plaintiffs had partial success in respect of failure to have regard to relevant official plans and policies. Although the plaintiffs failed to establish that relevant official plans and policies was a mandatory consideration in respect of the path decisions, it was a mandatory consideration in respect of the management plan decision and very little additional time was devoted to the additional allegation that it was a mandatory consideration in respect of the path decisions. The plaintiffs established that the Council failed to have regard to the vegetation management plans in respect of the management plan decision but failed to establish that other plans were relevant official plans and policies. Collectively consideration of these other plans occupied about the same time as consideration of the vegetation management plans.
Weighing the success and failure of the plaintiffs on the issues and sub-issues and taking into account the costs incurred in respect of the issues on which the plaintiffs succeeded and those on which they failed, it is appropriate to order that the plaintiffs recover 90 per cent of their costs of the action.
Conclusion
The plaintiffs are to recover from the Council 90 per cent of their costs of the action. I will hear the parties as to the appropriate order to reflect these reasons for judgment in combination with the parties’ agreement in respect of the costs charged by Dr Semeniuk.