GORRILL v City of South Perth - [2003] WASC 193

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: GORRILL & ORS -v- CITY OF SOUTH PERTH [2003] WASC 193

CORAM: MASTER NEWNES

HEARD: 15 SEPTEMBER 2003

DELIVERED : 10 OCTOBER 2003

FILE NO/S: CIV 1284 of 2002

BETWEEN: CHRISTOPHER JOHN GORRILL
PATRICIA CARMEL GORRILL
First Plaintiffs
LAURENCE GEORGE FLETCHER
IAN HENRY SINGE
Second Plaintiffs
ALLAN CAMPBELL FRANCIS
Third Plaintiff
DARLEY HEIGHTS PTY LTD
Fourth Plaintiff
AND
CITY OF SOUTH PERTH
Defendant

Catchwords:

Practice and procedure - Application to amend defence - Whether discloses arguable defence - Turns on own facts

Legislation:

Nil

Result:

Application dismissed

Category: B

Representation:

Counsel:

First Plaintiffs               :     Mr P Mendelow
Second Plaintiffs           :     Mr P Mendelow
Third Plaintiff               :     Mr P Mendelow
Fourth Plaintiff             :     Mr P Mendelow
Defendant:     Ms D M Templeman

Solicitors:

First Plaintiffs               :     Brickhills
Second Plaintiffs           :     Brickhills
Third Plaintiff               :     Brickhills
Fourth Plaintiff             :     Brickhills
Defendant:     Minter Ellison

Case(s) referred to in judgment(s):

Butler v Egg & Egg Pulp Marketing Board (1966) 114 CLR 185
Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Henville v Walker (2001) 206 CLR 459
Hooker Corporation Ltd v Commonwealth (1986) 65 ACTR 32
Hospital Contribution Fund Australia v Hunt (1983) 44 ALR 365
Livingstone v Rawyards Coal Company (1880) 5 App Cas 25
Sinclair v James [1894] 3 Ch 554

Case(s) also cited:

Briggs v Curtis Quick & Associates, unreported; SCt of WA; Library No 980141; 30 March 1998
Chaplin v Hicks [1911] 2 KB 786
Dermer v Shire of Busselton [2002] WASC 15
Niven v Grant (1903) 29 VLR 102
Rosenberg v Percival (2001) 205 CLR 434
Watts v Rake (1960) 108 CLR 158

MASTER NEWNES: This is an application by the defendant for leave to amend its defence. The application is opposed by the plaintiffs, primarily on the ground that the proposed amended plea discloses no arguable defence.
The first to third plaintiffs are the owners of various units in a 13‑storey apartment building in South Perth, known as Darley Heights. Those plaintiffs purchased their respective units in Darley Heights between 1979 and 1995. The fourth plaintiff is the registered proprietor of the land on which Darley Heights stands. The defendant is the local authority for the area under the Local Government Act.
On 13 February 1996, an application was submitted to the defendant by a third party for planning approval for the development of an eight‑storey building containing six dwelling units ("Goldman Apartments") on land immediately adjacent, to the west of Darley Heights. The properties have a common boundary. The application sought several variations from the requirements of the Residential Planning Codes of Western Australia ("R Codes") which apply to such developments.
The application was considered by the defendant's Design Advisory Committee on 13 February 1996, the day it was lodged. The Committee determined that the variations which the developer sought to the applicable setbacks in the R Codes for such a building should be approved. By a notice dated 13 March 1996, the defendant granted planning consent for the development of Goldman Apartments on the terms set out in the notice.
On 29 January 1997, a building licence was issued to enable the construction of Goldman Apartments.
The defendant approved modified drawings for the balconies of Goldman Apartments on about 13 May 1997, the effect of which was that perforated metal screens to drying ports were located in line with the exterior walls of Goldman Apartments facing Darley Heights.
Construction of Goldman Apartments commenced in May 1997 and was completed in August 1998.
The plaintiffs allege that the defendant was negligent in granting, or purporting to grant, approval for the construction of Goldman Heights. Several complaints are made by the plaintiffs. The first relates to the setback for Goldman Apartments.
By cl 1.5.7 of the R Codes the defendant may allow lesser setbacks than that stipulated in the Codes, provided the defendant has regard to the objectives set out in clause 1.2 the Codes, to the effect of such a variation on the amenity of any existing lot, and to the existing and potential use and development of any adjoining lot. The objectives set out in cl 1.2 included ensuring adequate standards of privacy of all dwellings, protecting the amenity of adjoining buildings by, among other things, minimising visual intrusion, and enhancing the amenity of residential areas.
Under cl 1.5.10 of the R Codes, where a proposal to vary a building setback may significantly affect the amenity of an adjoining property, then, in the absence of the prior agreement of the adjoining owners, the defendant must cause the adjoining owners to be advised in writing of the proposed variation and to be afforded access to the plans of the proposed development for a period of not less than 14 days. In determining the planning application, the defendant must have regard to any submissions it receives during that 14‑day period.
The plaintiffs say that the defendant approved the variation to the setback of Goldman Apartments without regard to the matters set out in cl 1.5.7 and without following the procedure set out in cl 1.5.10. As a result of the reduced setback that was approved, Goldman Apartments blocks out the views which the plaintiffs previously had, and detracts from the amenity of Darley Heights, to a much greater extent than if Goldman Apartments had been constructed in accordance with the standards set out in the R Codes.
The plaintiffs also say that the defendant wrongly allowed Goldman Apartments to be constructed in excess of the permitted plot ratio.
The plaintiffs say that, as a result of the size, design and reduced setbacks of Goldman Apartments approved by the defendant, the plaintiffs have lost a significant part of the panoramic views they previously enjoyed, they suffer a lack of privacy, have a view of unsightly laundry fittings and fixtures in Goldman Apartments and are disturbed by noise and lights from Goldman Apartments.
The plaintiffs say that, in approving the construction of Goldman Apartments without regard to the factors required by the R Codes to be taken into account, and without following the procedure set out in cl 1.5.10, the defendant was in breach of its duty of care to them.
The plaintiffs say that, had they been advised of the application, they would have objected to it. Alternatively, they contend that Goldman Apartments was unlawfully constructed because, having failed to comply with the provisions of the R Codes, the defendant had no power to approve its construction in the form that was approved.
The plaintiffs claim damages for the diminution in the value of their units which they say has resulted from the construction of Goldman Apartments.
By this application, the defendant seeks leave to amend its defence to add a new plea to the effect that, even if it had followed the procedures that the plaintiffs allege should have been followed, it would still have approved the construction of Goldman Apartments in the form that was approved. The amendments are in the following terms:
"44.The defendant says that if, which is denied, it owed duties of care to the plaintiffs which have been breached, an award of damages should only place the plaintiffs in the same position in which they would have been had the duty or duties not been breached.
45.The defendant denies that any breach of duty (which is denied) caused the plaintiffs any loss and/or damage, in the alternative, loss and damage as alleged, and says that:
(a)pursuant to clause 1.5.7 of the R Codes the defendant was empowered to allow a lesser setback than the minimum specified elsewhere in the R Codes;
(b)clause 1.5.10 of the R Codes provided that where a proposal to vary building setback requirements may significantly affect the amenity of an adjoining property, unless the prior agreement of adjoining owners and occupiers to the proposed development has been advised, Council shall:
(i)cause the owners and occupiers of affected property to be advised in writing of the proposed variation;
(ii)afford reasonable access to the plans of the proposed development for a period of not less than 14 days commencing on the date of notification; and
(iii)in its determination of the application, have regard for any submissions received during the 14 day period specified in paragraph (ii) above, save that the period shall be deemed to be lapsed when submissions from all owners are received;
(c)the defendant was not required by the R Codes, or at all, to give effect to submissions received;
(d)the setback variations which now exist could, therefore, have been approved in any event; and
(e)the setback variations which now exist would have been approved in any event.
46.The defendant:
(a)was empowered to grant planning consent for a building which complied with plot ratio requirements pursuant to clause 1.4 of the R Codes;
(b)in the event that the defendant took the view that the plans for the Goldman Apartments did not comply with the plot ratio requirements, the application would have been approved but with a condition imposed to require modification to comply with plot ratio requirements;
(c)in that case, the developers would then have submitted amended plans as similar as possible to the original design by complying with the plot ratio requirements, so as to maximise the economic potential of the land;
(d)those plans would have been similar to the attached Sketch Plans;
(e)the defendant was therefore empowered to grant planning consent for a building with the dimensions and location as set out in the attached Sketch Plans complying with the plot ratio requirement in subparagraph (a) ('the Alternative Building');
(f)if the defendant had imposed a condition that the plans for the Goldman Apartments comply with the plot ratio, the Alternative Building would have been approved and constructed;
(g)had the Alternative Building been constructed, the plaintiffs' views would be 2 degrees larger than they currently are; and
(h)the affect on the plaintiffs (if any) would have been the same or substantially the same as any effect presently experienced."
The plaintiffs oppose leave being granted. They contend that the defendant is seeking to say, in effect, that even if it had acted lawfully, it would have acted in the same way. Such a plea is not open to it. Once unlawful conduct which leads to loss and damage is established, the plaintiff is entitled to be compensated for that loss and damage. What might have been the outcome, if the defendant had acted lawfully, is not to the point. The plaintiff is entitled to be placed in the position it was in before the wrong occurred.
Counsel for the plaintiffs referred to CCH Australian Torts Reporter, vol 2 at 54‑720:
"The principle upon which remedies in tort is based is that of compensation. Compensation is intended to achieve restitutio in integrum, that is, to restore the plaintiff to the position he is in before the commission of the tort: per Lord Blackburne in Livingstone v Rawyards Coal Co [1880] 5 App Cas 25 at 39."
I should interpose that what Lord Blackburne said in Livingstone v Rawyards Coal Company (1880) 5 App Cas 25 was as follows:
"I do not think that there is any difference of opinion as to its being the general rule that, where any injury is to be compensated by damages, in settling the sum of money to be given reparation of damages, you should as nearly as possible get at that sum of money which will put the party who has been injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong for which he is now getting his compensation or reparation."
Counsel also referred to Halsbury's Laws of Australia at 135 ‑ 20:
"Restoration of status quo ante
Compensation is the restoration of plaintiffs to the position that they occupied before the wrong. In tort this means the position that was obtained before the tort was committed."
It was argued that, before the commission of the alleged tort, that is, the defendant's negligent approval of the building application, the plaintiffs had uninterrupted views and the amenity of Darley Heights was uninhibited. They are entitled to be restored to that position so far as damages can do so.
In the course of argument, the plaintiffs' counsel accepted that the plaintiffs could have no complaint if the defendant had approved the construction of a building that complied with the R Codes, or if the defendant had conformed to the requirements of the R Codes in approving any variations to the Codes. It did not therefore follow that, if the defendant had fulfilled its alleged statutory obligations, no building would have been constructed on the land adjacent to Darley Heights.
The plaintiffs also say that the plea in par 45 of the proposed amendment is manifestly defective. The defendant cannot now say that it would have reached the same view with respect to the building application, even if it had sought the views of adjoining owners, when it does not know what submissions those owners might have made. It is, in effect, a plea that, contrary to the R Codes, it would have disregarded any submissions.
The plaintiffs also complain about par 46 of the proposed amendment, in which it is pleaded that alternative plans would have been approved which are "similar" to the sketch plans attached to the proposed amended defence. That, the plaintiffs submit, is embarrassingly vague because it is not clear to what extent it is said the alternative plans might have differed from the sketch plans.
The defendant says that the plaintiffs' approach is based on a misapprehension of the position at law. In the defendant's submission, which I accept, in a case of this sort the plaintiffs are entitled, not to be restored to the position they were in before the alleged tort was committed in a temporal sense, but to be put in the position they would have been in if the alleged tort had not been committed: Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 at 12. That is also supported by Butler v Egg & Egg Pulp Marketing Board (1966) 114 CLR 185 per Taylor and Owen JJ at 191, where their Honours state that in tort a plaintiff should receive compensation which "will put him in the same position as he would have been in if … the tort had not been committed: Livingstone v Rawyards Coal Co". I might observe that those cases are cited by the learned author of Halsbury's Laws of Australia in support of the passage at par 135 – 20, to which I referred earlier, from which I take it that that passage is intended to be understood as stating the law in the sense submitted by the defendant.
The question, then, assuming the plaintiffs establish the alleged breach of duty, is what would have been the plaintiffs' position if the defendant had not breached its duties under the R Codes in approving the plans for Goldman Apartments?
The defendant says it is entitled to plead and prove that, even if it had not breached its duty as alleged, the outcome for the plaintiffs would have been the same, or substantially the same.
The defendant also argued that, in any event, it is for the plaintiffs to show that, if the defendant had fulfilled the obligations that they contend it had, the loss and damage would not have occurred. That is, the plaintiffs must prove that, if the defendant had acted as they say it should, Goldman Apartments would not have been constructed and they would not, therefore, have lost their views and the amenity they enjoyed.
The plaintiffs, on the other hand, contended that the opposite is the case; that is, once the plaintiffs show a breach of duty followed by damage, it is for the defendant to establish why the plaintiff is not entitled to recover that damage. Counsel referred to Henville v Walker (2001) 206 CLR 459 per McHugh J at 507.
A good deal of exegesis was devoted to this last issue, but it does not seem to me to be necessary to deal with it for the purposes of determining this application. What the defendant seeks to do by this application is to amend its defence to plead specifically that, even if the alleged breach of duty had not occurred, the result would have been the same or substantially the same.
The defendant says that par 46 of the minute does not plead that no attention would have been paid to any submissions received by it. What is pleaded, or at least intended to be pleaded, is that submissions to the same effect as the objections now advanced by the plaintiffs would not have altered the defendant's approach to the application, as those matters had already been taken into account by the defendant.
The principles to be applied on an application of this sort are well‑established and were not in dispute. Leave will not be granted to amend a pleading into a form which is liable to be struck out as defective or disclosing no reasonable cause of defence: Hooker Corporation Ltd v Commonwealth (1986) 65 ACTR 32 at 38, Sinclair v James [1894] 3 Ch 554 at 557. But before a plea is struck out as disclosing no cause of defence, it must be shown that the plea is so obviously untenable that it cannot possibly succeed and great care must be exercised to ensure that a party is not improperly deprived of their opportunity to put their case at trial: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 130. In that regard, Courts at first instance should be careful not to risk stifling the development of the law: Hospital Contribution Fund Australia v Hunt (1983) 44 ALR 365 at 373.
As I have said, in the present case, the defendant seeks to plead and prove that, even had it followed the statutory procedure which the plaintiffs say should have been followed, it would have given approval for the construction of Goldman Heights as it was, or substantially as it was, in fact, constructed and that construction would have gone ahead as it did.
I do not consider that the plaintiffs have established that the proposed defence is obviously untenable. Subject to some matters relating essentially to form, I do not think the defendant should be precluded from pleading that defence if it wishes to do so.
I accept, however, that the proposed pleading, as it presently stands, is objectionable. It does not clearly emerge from the terms of par 45(c), (d) and (e) that what is intended is that submissions to the effect of the complaints now made in the statement of claim would not have affected the defendant's decision, because it had already taken those matters into account. As it stands, the pleading suggests, or at least is capable of being read as meaning, that the defendant would not have taken any submissions into account.
In par 46 there is, in my view, some uncertainty about the pleas in subpars (b) to (d) in the context of those in subpar (e) and (f). In subpars (b) to (d), it is pleaded that, if no variation to the plot ratio had been approved, the plans which the developer would have resubmitted would have been "similar to the attached Sketch Plans". It is then pleaded in subpars (e) and (f) that the defendant was therefore empowered to grant planning consent for a building with the dimensions and locations set out in the Sketch Plans and such a building would have been approved. However, if the plans submitted by the builder were "similar", rather than identical, to the Sketch Plans, it is not clear how the defendant could have approved the construction of a building identical to the Sketch Plans. In my view, the plea as it stands is embarrassing. Moreover, if the building that would have been constructed is said to be "similar", rather than identical, to the Sketch Plans, the similarities and differences will need to be particularised with some specificity so the plaintiffs know the case they have to meet. I understand from the defendant's submissions that, in fact, it will contend that the building would have been identical, rather than similar, but if that is the case, the pleading should make it clear.

The plaintiffs' counsel also submitted that if the plea were allowed, it should be a condition of leave being granted that the defendant set out in the amended pleading proper particulars of the grounds relied upon for the pleas in pars 45(e) and par 46(c), (d) and (f). I accept that submission. To the extent those pleas, or pleas to the same effect, are relied upon, they should be particularised so that the plaintiffs know the case that is sought to be made against them.
I would therefore refuse the application for leave to amend in terms of the Minute but would grant leave to the defendant to file a further amended defence.
I will hear the parties on the time within which that should be done and costs.