Dunne v Chief Commissioner of State Revenue
[2000] NSWLEC 52
•03/06/2000
Land and Environment Court
of New South Wales
CITATION: Dunne & Anor v Chief Commissioner of State Revenue [2000] NSWLEC 52 PARTIES: APPLICANT:
RESPONDENT:
Donald James Dunne and Jury Lynn Dunne
Chief Commissioner of State RevenueFILE NUMBER(S): 30034 and 30237 of 1999 CORAM: Sheahan J KEY ISSUES: Costs :- in Class 3 LEGISLATION CITED: CASES CITED: Foboco Pty Ltd v Kiama Municipal Council (Sheahan J, NSWLEC, 23 April 1998, unreported);
Raiti v Leichhardt Municipal Council (1991) 72 LGRA 333;
Minas v Botany Council (1987) 65 LGRA 129;
Latoudis v Casey (1991) 70 CLR 534;
Kremer & Associates v North Sydney Municipal Council (1982) 47 LGRA 209DATES OF HEARING: 06/03/00 EX TEMPORE
JUDGMENT DATE :03/06/2000 LEGAL REPRESENTATIVES: RESPONDENT:
APPLICANT:
Mr A Hyam (Barrister)
Mr P Kelso (Solicitor)
SOLICITORS:
Taylor Kelso
JUDGMENT:
IN THE LAND AND Matter No: 30034 and 30237 of 1999
ENVIRONMENT COURT Coram: Sheahan J
OF NEW SOUTH WALES 6 March 2000
Applicants
v
CHIEF COMMISSIONER OF STATE REVENUE
Respondent
1. The applicants in these two Class 3 matters seek an order for costs on the basis stipulated in the Practice Direction of the court, namely that the circumstances are so exceptional as to enliven the court’s discretion in their favour.
2. They rely on a list of cases which I reviewed in depth in the matter of Foboco Pty Ltd v Kiama Municipal Council (No.10360 of 1997, 23 April 1998) to which Mr Hyam also referred at some length. To my knowledge no issue has been taken in this court with my analysis in Foboco of the correct principles for me to apply.
3. The applicants rely particularly on Raiti v Leichhardt Municipal Council (1991) 72 LGRA 333 , in which Hemmings J said at p 336:
In all the circumstances therefore, I am of the opinion that the applicant has been wholly successful in the appeal, and it was obliged to appeal to the Court because of the failure of Council to properly discharge or even attempt to discharge its duties under the Act. The applicant was compelled to come to this Court to obtain the consent that it would have obtained if Council had performed those duties. I think the applicant should be compensated for the expenses that were incurred, and therefore I order the Council to pay the applicant’s costs of this appeal.
4. The applicants further rely on Minas v Botany Council (1987) 65 LGRA 129, in which Bignold J found exceptional circumstances in the making by Council of “ a very material mistake ” which “ so influenced the Respondent’s dealing with ” the matter that the litigation became necessary and was ultimately successful.
5. It is not necessary to prove “ bad faith ”. Latoudis v Casey (1991) 70 CLR 534 makes clear that an order for costs is compensatory, not punitive. The court must review the conduct of both parties to decide the appropriate apportionment of the costs burden. In circumstances of error, as distinct from bad faith, it is pertinent to recall the words of the then Chief Judge, McClelland J, in Kremer and Associates v North Sydney Municipal Council (1982) 47 LGRA 209 at 220, and I quote from Foboco where I relied upon the same passage. His Honour said:
If errors of fact and/or law by councils were, in themselves, sufficient to ensure the success of an application for the costs of a successful appeal, there would be few instances in which such an order would be refused. In the present case the council had a discretion to withhold consent to the application and it did so in good faith even though, in my view, it misapprehended both the affect (sic) of the interim development order and the merits of the application.
6. In this case the error was serious and fundamental. The parties agreed that the property should be valued on the basis of its highest and best use. They even agreed that such use was multi-unit housing, and on the value per unit. The applicants said the relevant number of units was 6; the respondent said 8; and both sides agreed that $200,000 per unit was the appropriate figure as at the date of the earlier valuation.
7. The applicants were originally self-represented and Counsel came into the matters very late in the piece. When the expert reports were seen by the respondent’s key witness, the respondent became aware for the first time that the applicants had a development consent. The respondent then acted in a highly responsible way, conceding the case to the applicants and entering consent orders.
8. The applicants had not made clear that their consistent position was based upon a development consent, rather than on town planning principles or a restrictive covenant. The parties were, and negotiated, at cross purposes. The respondent made some routine, but not exhaustive, inquiries. The respondent seems to have been on notice of a development application, but did not check for Council’s attitude to that development application, or its decision upon it.
9. The applicants filed their expert reports on 27 August. The Notice of Motion to vacate the original hearing dates came before the court on 31 August. The respondent was also represented at a callover on 27 September. There were ongoing decisions between the parties and their experts, yet the respondent’s expert officer swears that he did not see the applicants’ reports until November, very soon before the re-scheduled hearing date.
10. There is no affidavit of service in the file and no explanation of that delay has been provided. This is a relevant gap in the evidence, because once those reports were reviewed, the respondent made the inquiries and decisions which led to its capitulation.
11. To that extent the facts are somewhat analogous to those in Foboco . However, this case did not turn on a development application to a small rural council, it involved precisely the basic work done daily by the respondent.
12. The respondent’s behaviour was certainly not capricious, mala fide, reckless or irresponsible, to use some of the words used in the various cases referred to in Foboco ; but its inquiries were demonstrably and remarkably, indeed “ exceptionally ”, inadequate, given all the circumstances and the amounts involved, and I have concluded that the applicants should have the benefit of the court’s discretion on the question of the costs of the substantive proceedings.
13. Accordingly, the respondent is ordered to pay the applicants’ costs of both proceedings on a party-party basis, such costs to be agreed, or subjected to the assessment process provided by the court, according to law.
14. As the parties have agreed that the costs of this Notice of Motion should follow the event, the respondent is further ordered to pay the applicants’ costs of this Notice of Motion on the same basis.
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