F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 4)

[2007] NSWLEC 649

Land and Environment Court

of New South Wales

CITATION:

F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 4) [2007] NSWLEC 649

PARTIES:

APPLICANT:
F & D Bonaccorso Pty Limited

FIRST RESPONDENT:
City of Canada Bay Council

SECOND RESPONDENT:
Arinson Pty Limited

THIRD RESPONDENT:
Omaya Holding Pty Limited

FOURTH RESPONDENT:
Omaya Investments Pty Limited

FILE NUMBER(S):

40171 of 2007

CORAM:

Biscoe J

KEY ISSUES:

Costs :- applicant successful in judicial review proceedings in class 4 of Court's jurisdiction - apportionment of costs where successful applicant fails on some issues in a multi-issue case - costs of obtaining interlocutory injunction to restrain demolition works after proceedings had commenced where development consent invalid - res judicata where a costs issue decided in earlier proceedings

Judicial Review - apprehended bias of council in granting development consent - whether order should be made under s 25B Land and Environment Court Act to suspend operation of consent and specify terms which would validate the consent

LEGISLATION CITED:

Corporations Act 2001 s 471
Environmental Planning and Assessment Act 1979 ss 97, 98, 104
Land and Environment Court Act 1979, ss 25B, 25C, 25E, 69

CASES CITED:

Belmore Residents' Action Group Inc v Canterbury City Council (2006) 147 LGERA 226;
Bungendore Residents Group Inc v Palerang Council (No 4) [2007] NSWLEC 536;
Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502;
Centro Properties Ltd v Hurstville City Council (2004) 135 LGERA 257;
Cutcliffe v Lithgow City Council (2006) 147 LGERA 330;
F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 2) [2007] NSWLEC 537;
F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 3) [2007] NSWLEC 569;
Kindimindi Investments Pty Ltd v Lane Cove Council (2006) 147 LGERA 118;
Kindimindi Investments Pty Limited v Lane Cove Council & Anor (No. 2) [2006] NSWLEC 539;
Kindimindi Investments Pty Ltd v Lane Cove Council (2007) 150 LGERA 333;
Maitland City Council v Anambah Homes Pty Ltd (2005) 64 NSWLR 695;
Mid Western Community Action Group Inc v Mid-Western Regional Council & Stockland Development Pty Limited [2007] NSWLEC 411;
Oshlack v Richmond River Council (1998) 193 CLR 72

DATES OF HEARING:

24 September 2007

 
DATE OF JUDGMENT: 

5 October 2007

LEGAL REPRESENTATIVES:

APPLICANT:
Mr P Tomasetti and Mr J L Doyle, barristers
SOLICITORS:
Thomson Playford

FIRST RESPONDENT:
Dr J E Griffiths SC
SOLICITORS:
Maddocks

THIRD AND FOURTH RESPONDENTS:
Mr J A Ayling SC
SOLICITORS:
Gadens Lawyers

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

BISCOE J

5 October 2007

40171 of 2007

F & D BONACCORSO PTY LTD v CITY OF CANADA BAY COUNCIL AND ORS

JUDGMENT

1 HIS HONOUR: The questions at issue in this matter are relief and costs. They arise in consequence of my judgment in F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 2) [2007] NSWLEC 537 in which I upheld the applicant’s challenge to the validity of a development consent granted by the respondent council in February 2007 on just one ground, apprehended bias. All other grounds of challenge were rejected.

2 The 2007 consent was for the demolition of ten houses and ancillary structures at 2, 4, 6, 8, 10, 11, 12, 13, 15 and 21 Chapman Street, Strathfield. Five of the houses were listed as heritage items. Three of the heritage items, namely 4, 8 and 13 Chapman Street, were the subject of a contract of sale entered into in 2000 between the council (the first respondent) and the second respondent (Arinson). The heart of the applicant’s apprehended bias case was special condition 17 of the contract which provided that the council agreed, as consent authority, to accept and approve an application for the demolition of all or any of the properties comprised in the contract, subject to conditions as it may reasonably impose in accordance with its usual practice when approving such applications. I upheld the apprehended bias case on the basis of special condition 17 and other matters pleaded which, although insufficient of themselves to support a finding of apprehended bias, indicated a continuum of conduct that was consistent with honouring special condition 17. I indicated that in order to allay the apprehension of predetermination it would be necessary and sufficient for council to expressly and publicly repudiate special condition 17 and expressly communicate its repudiation to the other party to the contract: at [141].

3 The third and fourth respondents (Omaya), but not the other respondents, submitted that I should exercise the Court’s discretion pursuant to s 25B of the Land and Environment Court Act 1979 (NSW) (Court Act) by either validating or suspending the operation of the 2007 development consent on terms. Any view concerning validity expressed in my earlier judgment was subject to consideration of whether a s 25B order should be made. Sections 25B and 25E provide as follows:

25B Orders for conditional validity of development consents

(1) The Court may, instead of declaring or determining that a development consent to which this Division applies is invalid, whether in whole or in part, make an order:
(a) suspending the operation of the consent in whole or in part, and
(b) specifying terms compliance with which will validate the consent (whether without alterations or on being regranted with alterations).
(2) Terms may include (without limitation):
(a) terms requiring the carrying out again of steps already carried out, or
(b) terms requiring the carrying out of steps not already commenced or carried out, or
(c) terms requiring acts, matters or things to be done or omitted that are different from acts, matters or things required to be done or omitted by or under this Act or any other Act.

25E Duty of Court

It is the duty of the Court to consider making an order under this Division instead of declaring or determining that a development consent to which this Division applies is invalid, whether in whole or in part.

4 Although Arinson was not represented in relation to relief or costs, the alternative short minutes of orders proposed by Omaya, founded on s 25B, had endorsed on them the notation that they were “favoured by” Arinson as well as Omaya. It appears that there is a common directorship between Arinson and Omaya. Three versions of relief said to be favoured by Omaya and Arinson were proffered by Omaya:

(a) the most favoured version provides for a declaration which validates the consent insofar as it relates to the properties other than the three properties affected by special condition 17 of the sale contract, and an order which suspends the operation of the consent insofar as it relates to those three properties so as to enable council to consider repudiating special condition 17 and to reconsider the development application as it relates to those three properties. If council does so, the whole consent would become valid;
(b) the second preferred version provides for an order that suspends the operation of the whole consent and orders that the council consider repudiating special condition 17 and reconsider the development application as it relates to the three properties. If council does so, the whole consent would become valid;
(c) the least preferred version provides for a declaration that the development consent, insofar as it relates to the said three properties, is invalid.

5 The leading case on s 25B of the Court Act is Kindimindi Investments Pty Ltd v Lane Cove Council (2007) 150 LGERA 333 where the Court of Appeal decided that it is not limited to invalidity arising from preliminary steps. In that case the error of the council which led to potential invalidity of a development consent was that a measure with respect to pedestrian safety by construction of a school drop-off facility was not included in the conditions of consent, but rather in a deed between the council and the second respondent. The primary judge, Lloyd J held that it was an appropriate case for the application of s 25B because the error was “technical”, being a simple failure to impose a condition to give effect to the council’s intention. His Honour suspended the operation of the consent and specified terms which would validate the consent: Kindimindi Investments Pty Ltd v Lane Cove Council (2006) 147 LGERA 118 at [25] – [26]. The council complied with those terms. Thereafter Lloyd J made orders upholding the validity of the consent in which he again described the error as “technical”: [2006] NSWLEC 539 at [8]. His decision was upheld on appeal (2007) 150 LGERA 333. Hodgson JA held at [21]: “The general intention was that technical breaches should be capable of being rectified, and there can be technical breaches which are not matters arising from preliminary steps”. Tobias JA agreed with the reasons of Hodgson JA: at [27]. McColl JA agreed with both Hodgson and Tobias JJA: at [40]. Tobias JA added some further observations which indicated, obiter, that s 25B might be applied in some circumstances where there had been failure to consider matters required to be considered under s 79C of the Environmental Planning and Assessment Act 1979 (NSW): at [32] – [33].

6 In Centro Properties Ltd v Hurstville City Council (2004) 135 LGERA 257, which was approved by Tobias JA in Kindimindi at [33], McClellan CJ held at [85]:

Apart from the question of whether s 25B is available, where the council’s decision-making process has miscarried, as opposed to a failure to consult with or obtain the concurrence of another authority, I do not consider it to be an appropriate course in this case…

7 In the present case, the council’s decision-making process has miscarried.

8 Subsequent to the decision of the primary judge, but prior to the Court of Appeal’s decision, in Kindimindi, Talbot J in Belmore Residents’ Action Group Inc v Canterbury City Council (2006) 147 LGERA 226 declined to make an order under s 25B in circumstances where the consent was found to be invalid for failure to take into account Draft State Environmental Planning Policy (Application of Development Standards) 2004. His Honour held:

32 Although Lloyd J decided to apply the provisions of s 25B in Kindimindi it is appropriate to appreciate the circumstances under which he made that decision. He determined at [25] that the error of the council amounted to a discrete matter of a technical nature that could be considered in isolation from other matters. It was a simple failure to impose a condition to give effect to the council’s intention and accordingly was an appropriate case for the application of s 25B. The circumstances considered by Lloyd J in Kindimindi are clearly distinguishable from the nature of the invalidity under consideration in the other authorities and in particular in the present case.

33 In CentroProperties I also declined to make an order pursuant to s 25B of the Court Act as the steps to be undertaken involved the weighing of the provisions of the same Draft SEPP under consideration in this case as part of the total consideration required pursuant to s 79C and generally. Whatever matters are found to be relevant, if any, must be balanced and weighed against all the other matters that are relevant to the Council’s consideration. As I said in Centro this step necessitates a reopening of the whole process. It is not, in my view, the intention of s 25B or the other provisions within Pt 3 of Div 3 to allow the consent authority to reopen the whole of its consideration.

9 Subsequent to Kindimindi, Jagot J in Mid Western Community Action Group Inc v Mid-Western Regional Council & Stockland Development Pty Limited [2007] NSWLEC 411 considered whether an order under s 25B was appropriate in circumstances where a consent was found to be in breach of provisions of a local environmental plan which required council to consider the external design of the development and ss 76A(1) and 79C(1)(a)(i) of the Environmental Planning and Assessment Act 1979. The council left the external design of the building for later deferred consideration. The consent did not enable the council to identify the development to be carried out and the building to be erected in accordance with the consent. Jagot J held that it was appropriate in the circumstances to grant an order under Division 3 of Part 3 of the Court Act. Her Honour held at [46]:

Section 25B is different. The Court is obliged to consider making such an order instead of declaring a consent invalid (s 25E of the LEC Act). In Kindimindi Investments Pty Ltd v Lane Cove Council & Anor (2007) 150 LGERA 333 ( Kindimindi No 2 ) the Court of Appeal held that the provisions are not limited to invalidity arising from preliminary steps. Although Hodgson JA referred to the provisions as being intended to allow rectification of technical breaches (at [21]), Tobias JA considered the provisions capable of relating to a failure to consider any one or more of the matters in s 79C(1) of the EPA Act (at [32] and [36]). Tobias JA also placed weight on s 103 of the EPA Act as supporting the width of these provisions. Section 103 enables the consent authority to revoke a development consent to which s 25B applies whether or not the terms of the Court’s order have been complied with (at [37]). This approach is supported by s 25C of the LEC Act enabling the Court, amongst other things, to declare that a consent has been validly regranted.

10 Recently in Bungendore Residents Group Inc v Palerang Council (No 4) [2007] NSWLEC 536 Pain J declined to exercise the discretion under s 25B and observed at [42]:

There are several cases not overturned by Kindimindi in which this Court has held that matters that are fundamental to the granting of consent should not be the subject of s 25B orders; see Centro Properties v Hurstville City Council , (2004) 135 LGERA 257, Belmore Residents’ Action Group Inc v Canterbury City Council (2006) 147 LGERA 226, and GPT Re Ltd v Wollongong City Council (No 2) (2006) 151 LGERA 158. In Kindimindi , Tobias JA referred at [33] to Centro Properties as an example of a case where the application of s 25B was not considered appropriate. As identified at [31] - [33], the breaches I have found in this matter are substantive breaches, and I consider are similar in nature to the cases cited above where s 25B has not been applied.

11 Omaya submitted that the error of the council was a simple failure to publicly repudiate special condition 17; did not involve a reopening of the whole assessment process or go to the root of the consent; could be simply fixed as indicated in my earlier judgment in these proceedings at [141]; and there was no benefit that would be secured by declaring the development consent invalid.

12 The applicant objected to Omaya making a s 25B submission because it did not plead it nor make any submission in that regard at the main hearing, the evidence was closed and the applicant was thereby prejudiced in meeting the submission by evidence. I reject the objection. Section 25B obliges the Court to consider whether to make an order pursuant to s 25B. Although it is at least desirable for a party to give notice of an intention to rely on s 25B by pleading it, it may be difficult to do so with particularity until the Court has made its findings. There is no prejudice to the applicant that I can see.

13 The conduct of the council in contracting in terms of special condition 17 brought about a serious miscarriage of the decision-making process. It is likely to have undermined public confidence in the decision-making process. This is not a case of a technical error. Even if the legal test of apprehended bias were considerably higher than I concluded it to be in my earlier judgment, the test would be satisfied. There is a need to maintain public confidence in the decision-making process. That need would be poorly served by permitting the development consent to stand. If the spectre of apprehended bias is to be shaken off, it is better, if not necessary, that it occur in the context of a new development application. These factors weigh against the exercise of the discretion under s 25B.

14 Taking all matters into consideration, I decline to exercise the Court’s discretion under s 25B.

15 Omaya submitted that relief should not adversely affect the development consent insofar as it concerned properties other than the three affected by special condition 17 of the contract. Whether the submission was a free-standing submission or made in the context of s 25B, I do not accept it. The three heritage items the subject of the 2000 contract are part of the structure of the 2007 development consent and go to its root. If they were to be hewn away, the balance of the development consent would operate in a manner different to that in which the whole would have operated: cf Maitland City Council v Anambah Homes Pty Ltd (2005) 64 NSWLR 695 at [162] – [166] where Tobias JA reviewed the principles and authorities relating to the severance of an invalid condition of a development consent.

16 Further, in my view, there is no power under s 25B to make Omaya’s proposed declaration of validity, which Omaya did not claim in the proceedings. Under Part 3 Division 3, the power to declare a consent valid is limited to the circumstances contemplated by s 25C on an application by the Minister or any other consent authority. A consent declared to be valid under s 25C has the large consequence under s 104 of the Environmental Planning and Assessment Act 1979 that it is final and the appeal provisions of ss 97 and 98 of that Act do not apply to or in respect of it.

17 The relief that I propose includes a declaration that the 2007 development consent is invalid and is set out at the end of this judgment.

COSTS

18 The applicant submitted that costs should follow the event and therefore the council and Omaya should be ordered to pay its costs.

19 The council submitted that: (a) the applicant should be awarded costs only in relation to the apprehended bias issue and not in relation to the other issues upon which it failed and which are severable; (b) the applicant’s costs of the apprehended bias issue should be assessed at 20 percent of the applicant’s costs; (c) in relation to the applicant’s costs on the apprehended bias issue, the council should be ordered to pay 80 percent and Omaya should be ordered to pay 20 percent; (d) there should be no order for costs against the council in relation to the applicant’s costs of obtaining an interlocutory injunction against Omaya because that costs issue was resolved in the council’s favour in earlier proceedings between the parties relating to an earlier development consent in the context of which the interlocutory injunction was obtained: F & D Bonaccorso Pty Ltd v City of Canada Bay Council(No 3) [2007] NSWLEC 569 at [43] and [53]. In any event, the applicant never sought such costs against the council when seeking that injunction.

20 Omaya adopted the council’s submissions, although it submitted that the council’s proposed percentage assessment of costs relating to the apprehended bias issue was probably an overestimate and that consideration should be given to not obliging Omaya to contribute towards costs because its only significant input was in submissions. As to the costs of the interlocutory injunction, Omaya submitted that the applicants should bear those costs given that Omaya was brought into the earlier proceedings at a time when the earlier development consent was valid. Further, Omaya submitted that: (a) there should be taken into account that Omaya Investments was not joined as a party to the earlier proceedings until 11 July 2006; and (b) insofar as the applicant attacked the validity of the construction certificate which Omaya obtained prior to carrying out that work, that was not a significant issue on costs.

21 The applicant submitted in reply that it had not engaged in disentitling conduct; in its apprehended bias case it was necessary to go beyond special condition 17 of the contract to the continuum of facts; the issues on which it failed are not severable; if there is to be an apportionment of costs, then the 20 percent proposed by the council was unreasonably low; costs should be awarded against both the council and Omaya; and costs against the council in relation to the interlocutory injunction was not precluded by the earlier judgment.

22 The Court’s jurisdiction to make orders in relation to costs is found in s 69 of the Court Act which provides that costs are in the discretion of the Court. Costs will normally follow the event in class 4 of the Court’s jurisdiction, unless the successful litigant has engaged in disentitling conduct: Oshlack v Richmond River Council (1998) 193 CLR 72 at 96 – 98 per McHugh J; Cutcliffe v Lithgow City Council (2006) 147 LGERA 330 at [13] per Biscoe J. However, it is appropriate in some instances to apportion costs where the successful party does not succeed on all issues and the issues on which the successful party failed are separable from those upon which it succeeded. The authorities and principles relating to apportionment of costs were reviewed by me in my costs judgment in the earlier proceedings between the parties in which the applicant successfully challenged the validity of an earlier development consent granted in 2003 in relation to the same properties: F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 3) [2007] NSWLEC 569 at [15] – [17].

23 In the present proceedings, the applicant challenged the validity of the 2007 development consent on three grounds:

(a) council failed to take into consideration a heritage impact statement as required by cl 7(3) of the Concord Local Environmental Plan No. 103 (Heritage ) (Heritage LEP) and s 79C(1) of the Environmental Planning and Assessment Act 1979 ;
(b) council failed to take into consideration one or more of the following matters required to be taken into consideration by s 79C(1) of the Environmental Planning and Assessment Act 1979 :
(i) council’s “ Heritage Conservation Policy Concord ” of 1999;
(ii) matters required under cl 10 of the Heritage LEP;
(iii) public submissions; and
(iv) the Draft City of Canada Bay Local Environmental Plan and Draft City of Canada Bay Council Development Control Plan;
(c) council was apparently biased in its determination of the 2006 demolition development application, in the sense that it appeared to have predetermined the application.

24 The applicant was successful on the third ground only, as discussed at [2] above. Although the applicant succeeded on that ground, I did not accept wide ranging criticisms and allegations about the history of council’s dealings with the land in question and other land in the neighbourhood.

25 As regards the first ground, the applicant submitted that, although it failed, it was nevertheless successful on the sub-issue of the Staas report and it was only the council’s success in relation to the Hubert report that caused the applicant to lose the day on that ground. As regards the second ground, the applicant submitted that some at least of the matters relating to that ground were also pleaded as particulars to the apprehended bias claim. The applicant submitted that it is inappropriate to calculate costs by counting pages of the judgment attributable to the various grounds because that does not take into account work done in relation to interlocutory steps in the proceedings. The applicant further submitted that, as a discrete matter, both the council and Omaya should be ordered to pay its costs of obtaining an interlocutory injunction against Omaya.

26 I will leave to one side for the moment the issue of costs in obtaining an interlocutory injunction against Omaya.

27 In my view, the apprehended bias ground on which the applicant succeeded and the grounds on which it failed were substantially discrete such that the Court should exercise its discretion to apportion costs and award the applicant only its costs in relation to the ground on which it succeeded. The fact that the applicant had a degree of success on a sub-issue (the Staas report) of another issue on which it lost is insufficient to prevent that conclusion.

28 The exercise of the discretion depends upon matters of impression and evaluation and a broad-brush approach is appropriate. The applicant’s success on the apprehended bias ground was not limited to the existence of special condition 17 and it was entitled to adduce evidence as to the continuum of relevant conduct after the 2000 contract. It is my impression that in the order of 40 percent of the applicant’s costs are attributable to the apprehended bias ground, to the extent that I accepted its case on that ground.

29 Given that Omaya unsuccessfully contested the proceedings, I am unable to accept its submission that it should not have to pay any costs, although I accept that its active role in the proceedings was substantially less than that of the council.

30 The council proposed that the council pay 80 percent of the applicant’s costs attributable to the apprehended bias issue and that Omaya should pay the remaining 20 percent of the applicant’s costs relating to that issue. In principle, I am prepared to accede to that ratio. A variant on that formula is appropriate in order to protect the applicant against any hypothetical risk of insolvency of Omaya. I propose to order the council to pay 40 percent of the applicant’s costs and to order Omaya to pay 8 percent of the applicant’s costs being part of the 40 percent.

31 That leaves outstanding the question of costs in relation to the interlocutory injunction obtained by the applicant against Omaya in the earlier proceedings. The applicant submitted that both Omaya and the council should be ordered to pay those costs.

32 In my main judgment in these proceedings F&D Bonaccorso Pty Ltd v City of Canada Bay Council (No 2) [2007] NSWLEC 537 at [12] I recounted the history of events relating to the interlocutory injunction. It is necessary to expand on that history for present purposes, as follows.

33 On 6 July 2006 a construction certificate was issued to Omaya Investments Pty Ltd for the demolition of structures on the subject properties. Later that day demolition work occurred. It included partial demolition of three of the said five heritage items, namely, the houses at 4, 8 and 12 Chapman Street. The applicant submits that the construction certificate was invalid because it referred to the wrong owner of the land and the wrong development application number and was not authorised by the liquidator of Arinson to carry out work on such of the properties as were owned by Arinson.

34 On 6 July 2006 in the earlier proceedings, the Court granted an ex parte interlocutory injunction restraining Arinson and Omaya Holding Pty Ltd from carrying out further development on 4, 6 and 8 Chapman Street. The Court also made an order joining Omaya Holding Pty Ltd (whose name was misspelt) as a party. Paragraph 3 of the applicant’s notice of motion of 6 July 2006 seeking that interlocutory injunction and joinder as originally typed also sought an order that the council and Omaya Holding Pty Ltd pay the costs of the notice of motion, however it was amended by hand to refer only to Arinson and Omaya Holding Pty Ltd. The only respondents had been the council and Arinson. At that time Arinson was in liquidation and the applicant had not obtained leave from the Federal Court or Supreme Court under s 471 of the Corporations Act 2001 to bring its motion seeking interlocutory relief against Arinson.

35 On 11 July 2006 the applicant filed an amended notice of motion seeking continuance of the interlocutory injunction against both Omaya companies; joinder of both Omaya companies as parties to the proceedings (in the case of Omaya Holding Pty Ltd that may have been because its name was misspelt in the order of 6 July); and an order that the two Omaya companies pay the applicant’s costs of the motion. No other costs order was sought. On that day, by consent, the Court vacated the orders made on 6 July, ordered that the two Omaya companies be joined as respondents to the proceedings and ordered that until further order or 4 August 2006 the two Omaya companies be restrained from carrying out any further work without development consent on any of the subject properties (subject to certain exceptions). Costs were reserved.

36 On 4 August 2006 the Court continued the interlocutory injunction until 23 August 2006 when it was listed for hearing as a special fixture.

37 On 8 August 2006 the applicant served a proposed Further Amended Notice of Motion seeking an injunction in substantially the same terms until judgment in the proceedings and (inter alia) an order that the Omaya companies pay the applicant’s costs of the motion. That notice of motion was returnable on 23 August 2006.

38 On 16 August 2006 Omaya’s solicitors wrote to the applicant’s solicitors informing them that their instructions were to oppose the extension of the interlocutory injunction when the matter was before the Court on 23 August 2006. Omaya filed affidavit evidence in that regard and on 22 August 2006 Omaya lodged written submissions which appeared to oppose the continuance of the interlocutory injunction.

39 On 18 August 2006 the applicant filed and served the Further Amended Notice of Motion.

40 On 23 August 2006, the injunction was continued in similar form. It was not limited as to duration. The costs of the notice of motion of 6 July (amended on 18 August) were reserved.

41 On 5 April 2007 final orders were made in the earlier proceedings. Order 4, in effect, transferred the injunction aspect of those proceedings to be heard together with the present 2007 proceedings which had earlier been commenced.

42 The injunction or demolition issue was thus resurrected in the present proceedings. On 2 May 2007, by consent, the Court in the present proceedings granted an injunction restraining Omaya from carrying out further development on the subject properties including but not limited to demolition (subject to certain exceptions). It was not limited as to duration. On 17 July 2007, by consent, the Court granted an injunction in the same terms against Arinson. The liquidation of Arinson had been terminated by the Supreme Court on 16 July 2007.

43 On 31 August 2007 I delivered my main judgment in the present proceedings: F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 2) [2007] NSWLEC 537 where I relevantly said at [145]:

145 The demolition issue was formerly part of the 2003 proceedings but, by consent, was discontinued in those proceedings and resurrected in the present proceedings. On 2 May 200[7] in the present proceedings the Court, by consent, noted that the third and fourth respondents conceded that, as a result of the making of the declaration of invalidity of the 2003 development consent in the 2003 proceedings, the demolition works carried out to 4, 6, 8 and 12 Chapman Street pursuant to a construction certificate dated 6 July 2006 was not authorised by any valid development consent. It is not possible to say what the ultimate fate of these heritage items will be. However, in the circumstances, I consider that it is appropriate to make a declaration to the effect of that concession. I decline, for the reasons identified in the third and fourth respondents’ second submission, to make a declaration that their demolition works were carried out in breach of the EPA Act .

44 This history shows that Omaya contested the interlocutory injunction sought against them prior to 23 August 2006; the interlocutory injunction was thereafter maintained; the 2003 development consent was invalid; Omaya has conceded that the demolition works to 4, 6, 8 and 12 Chapman Street were not authorised by any valid development consent; and Omaya now acknowledges that a permanent injunction should be granted (although they seek to restrict it to 4, 8 and 13 Chapman Street). It is unnecessary to decide the validity of the construction certificate. In those circumstances, in my opinion, it is appropriate that Omaya Holding Pty Ltd, the third respondent, should be ordered to pay the costs of the applicant’s notice of motion filed on 6 July 2006 and as amended thereafter seeking injunctive relief. In the case of Omaya Investments Pty Ltd, the fourth respondent, the costs order should be restricted to the applicant’s amended notice of motion filed on 11 July 2006 and as amended thereafter, because it was not until that date that it was joined to the proceedings.

45 I reject the applicant’s submission that the council also be ordered to pay its costs in relation to the interlocutory injunction. That issue was decided adversely to the applicant in my costs judgment in the earlier proceedings between the parties F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No 3) [2007] NSWLEC 569, as follows:

43 The applicant claims costs against the council for the whole of the proceedings. The council submits that there should be excepted from such an order the applicant’s costs of obtaining an injunction against the second, third and fourth respondents to prevent works to demolish heritage items on the site. Council points to the fact that in the applicant’s notice of motion seeking the injunction and in the notice of motion as amended from time to time, the applicant never sought costs against the council but only against other respondents. In oral submissions the applicant conceded this point. It seems that this was understood by council to be conceded from the outset because council in its written submissions noted that it appeared that the applicant, properly, did not seek to recover those costs from council. Accordingly, when making an order that the council pay the applicant’s costs for the proceedings, I propose to make an exception in relation to the costs of obtaining the injunctions.
…
49 The costs of the applicant’s notice of motion seeking the injunction against Omaya were reserved. The applicant now claims from Omaya its costs of obtaining that injunction. Omaya were joined as respondents as a result of carrying out demolition works in reliance upon the 2003 development consent, which council subsequently conceded to be invalid, and in the context of the applicant seeking and obtaining an injunction to restrain them from carrying out such work. The issues relating to such demolition works were, in effect, transferred to be determined with proceedings No 40171 of 2007 in which the applicant claimed that a development consent granted by council in February 2007 was invalid. Omaya submits that all relevant breaches of law as determined by the Court in these proceedings were breaches by the council and not by Omaya and that, as such, no order for costs should be made against them.

50 In my view, in the circumstances, no order for costs should be made against Omaya in these proceedings. However, the costs of the applicant’s notice of motion for an injunction against Omaya, which have been reserved, should be determined in the 2007 proceedings to which they have been effectively transferred. I recently delivered judgment in those proceedings but the final form of relief and costs have not yet been determined: F & D Bonnaccorso Pty Ltd v City of Canada Bay Council (No 2) [2007] NSWLEC 537.
…
53 The Court makes the following costs orders:
1. The first respondent is to pay the applicant’s costs of the proceedings as agreed or assessed with the exception of the applicant’s costs of obtaining injunctions against the second, third and fourth respondents.
2. The issue of the applicant’s costs of obtaining injunctions against the third and fourth respondents is to be determined in proceedings No 40171 of 2007.
3. No order as to the costs of the costs applications.
4. The exhibits may be returned.

46 The applicant’s concession referred to at [43] of that judgment is recorded at, and illuminated by reference to, the transcript where it was made by counsel for the applicant in submissions in reply (p 72 on 20 August 2007):

TOMASETTI:…Lastly the point was made that application for costs would include the costs of the proceedings as a whole and that would not be reasonable. It’s said that the council should not be imposed with any costs order in relation to the injunction to protect the houses. Your Honour I can’t add to the submissions that have already been made. We acknowledge that the relief that was there sought was sought against the third and fourth respondents but with the exception of that particular aspect of the litigation the costs were primarily incurred in relation to the council’s defence of the case.

HIS HONOUR: Does that mean you don’t seek the costs of the injunction as against the council?

TOMASETTI: I think so, your Honour. It’s difficult to maintain that argument.

47 The issue having been decided in earlier proceedings it is, in my opinion, res judicata: Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; Spencer Bower, Turner and Handley, Res Judicata (3rd ed 1996) 1. If that be wrong, I would now decide the issue in the council’s favour having regard to the following circumstances. On 6 July 2006 the applicant’s solicitors gave the council’s solicitors a copy of the orders of that date obtained against other respondents. By letter dated 10 July 2006 the council’s solicitors informed the applicant’s solicitors that the council did not condone the demolition works and was not aware of same until notified as aforesaid. They said that council was considering whether an order should be issued pursuant to s 121B Order 3 of the Environmental Planning and Assessment Act 1979 but did not consider that that could be done without compliance with ss 121 F – 121 K. By letter dated 14 July 2006 the applicant’s solicitors notified the council’s solicitors that it reserved its right to join the council as a respondent on the pending motion on the issue of any costs the applicant incurred arising from the council’s delay in taking action. The applicant did not exercise that asserted right. The applicant’s notice of motion and amendments thereto seeking an interlocutory injunction sought costs against other respondents but not against the council. Indeed, the applicant’s initial notice of motion of 6 July 2006 was deliberately amended on its face so as to exclude the council from any such order by striking out the typed reference to the first respondent (the council).

48 None of the parties have obtained everything they sought on the hearing as to relief and costs on 24 September 2007. I therefore propose to make no order as to the costs relating to that hearing. Any interlocutory costs orders will not be vacated and will not be affected by the orders made below.

49 The Court makes the following orders:

1. Declaration that the development consent in respect of development application No. 649/2006 for premises at 2, 4, 6, 8, 10, 11, 12, 13, 15 and 21 Chapman Street, Strathfield granted by the first respondent on 20 February 2007 is invalid and of no force and effect.
2. Declaration that the demolition works carried out by the third and/or fourth respondents to the properties at 4, 6, 8 and 12 Chapman Street, Strathfield, on or about 6 July 2006 were not authorised by a valid development consent.
3. Order that the development consent granted by the first respondent for development application No. 649/2006 be set aside.
4. Order that the second, third and fourth respondents are restrained from carrying out works constituting the demolition (wholly or partly) of the buildings standing on the land at 2, 4, 6, 8, 10, 11, 12, 13, 15 and 21 Chapman Street, Strathfield, unless and until development consent is first obtained for that work.

5. Order that the first respondent pay 40 percent of the applicant’s costs as agreed or assessed except for the costs referred to in orders 7 and 8.
6. Order that the third and fourth respondents pay 8 percent, being part of the 40 percent referred to in order 5 (to the intent that the applicant should recover in total 40 percent from the first, third and fourth respondents), of the applicant’s costs as agreed or assessed except for the costs referred to in orders 7 and 8.
7. Order that the third and fourth respondents pay the applicant’s costs of its notice of motion filed on 6 July 2006 and amendments thereto relating to an interlocutory injunction, save that the fourth respondent’s liability under this order is limited to such costs as from 11 July 2006.
8. No order as to costs in relation to the hearing on 24 September 2007.