Hegira Limited v Department of Natural Resources and Water

[2006] QLC 79

LAND COURT OF QUEENSLAND

CITATION:	Hegira Limited v Department of Natural Resources and Water [2006] QLC 0079
PARTIES:	Hegira Limited (appellant/respondent)
v.
Chief Executive, Department of Natural Resources and Water (respondent/applicant)
FILE NO:	AV2005/1478
DIVISION:	Land Court of Queensland
PROCEEDING:	Hearing of an application for costs
DELIVERED ON:	22 December 2006
DELIVERED AT:	Brisbane
MEMBER:	Mr RS Jones
ORDER:	That the respondent to the application, Hegira Limited, pay the applicant, the Chief Executive, Department of Natural Resources and Water his costs of and incidental to the application, such costs to be assessed on the standard basis.
CATCHWORDS:	Costs - Section 34 Land Court Act 2000
APPEARANCES:	Mr D Fraser QC, instructed by Legal Services, Department of Natural Resources and Water, for the respondent/applicant.
Mr R Traves SC, instructed by Kinneally Miley Lawyers for the appellant/respondent.

[1]        This is an application by the Chief Executive, Department of Natural Resources and Water seeking an order for costs

Background

[2]        On 11 October 2005 Hegira Limited (Hegira) filed in this Court an appeal against the unimproved value assigned to its land by the Chief Executive pursuant to the Valuation of Land Act 1944. On 1 September 2006, the Chief Executive filed an application seeking orders that the appeal by Hegira be struck out for want of jurisdiction of this Court to deal with the appeal. That application was heard by me on 7 November 2006.

[3]        On 1 December 2006 I delivered my reasons for striking out the appeal.[1] The Chief Executive now seeks an order that Hegira pay his costs of and incidental to the application and of the appeal and that such costs be assessed. It is argued on behalf of Hegira that, in the circumstances of this application, I should make no orders as to costs.

[1]       Hegira Ltd v Department of Natural Resources and Water [2006] QLC 0074

The Costs Arguments

[4] There is no suggestion that this Court does not have the power or jurisdiction to award costs in proceedings such as these. Section 34 of the Land Court Act 2000 relevantly provides:

"(1) Subject to the provisions of this or another Act to the contrary, the Land Court
may order costs for a proceeding in the Court as it considers appropriate."

As was submitted by Mr Traves SC, senior counsel for Hegira, while the discretion to award costs is a wide one it nonetheless has to be exercised judicially and for reasons which can be justified by reference to relevant considerations.

[5]        The argument advanced on behalf of Hegira is effectively summarised in paragraph 7 of the written submissions of Mr Traves SC where it is said:

"…. The case was close or difficult, and there was no obvious element of fault on the part of the appellant. The matter is one of some public importance. To require the appellant to pay costs would be unfair: the drafting of the legislation was not the appellant's doing, and the position of the appellant was entirely reasonable. Each party should bear their own costs."

In this context, reference was made to the observations of Black CJ and French J in Minister for Immigration and Multicultural Affairs v Vadarlis[2] to the effect that, where a case is close and/or difficult and involves no obvious element of fault on the part of the "loser", the proposition that costs automatically follow the event may work an unfairness.

[2] (2001) 115 FCR 229

[6]        I accept that, at least as far as I was concerned, the application could fairly be described as being close and difficult to resolve. I also accept that Hegira did not act unreasonably in defending the strike out application, was not otherwise guilty of any fault and that matters of some public importance might be involved. However, as was submitted by Mr D Fraser QC, senior counsel for the Chief Executive, no fault or unreasonableness could be said to lie with his client. I agree with that submission.

[7]        It is important to bear in mind that, in cases such as this, any orders for costs are not awarded by way of punishment. In Latoudis v Casey[3] Mason CJ at p.543 said:

"If one thing is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of the unsuccessful party. They are compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings."

At p.567 of Latoudis McHugh J made observations to similar effect incorporating circumstances of "close" litigation and the reasonableness of the unsuccessful party. His Honour said:

"The rationale of the order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred. The order is not made to punish the unsuccessful party. Its function is compensatory. Thus, in civil proceedings an order may, and usually will, be made even though the unsuccessful party has nearly succeeded or has acted reasonably in commencing the proceedings. It may, and usually will, be made even though the action has failed through no fault of the unsuccessful party. In Cilli v. Abbott (16), Keely, Toohey and Fisher JJ. pointed out that 'the object of costs is not to penalize; it is to indemnify the successful party in regard to expense to which he has been put by reason of legal proceedings': see also Anstee v Jennings (17)"

[3] (1990) 170 CLR 534

[8]        That a matter involves elements of public importance is not irrelevant to the issue of costs. In Vadarlis (supra) Black CJ and French J, in the circumstances of that case, decided it appropriate to make no orders as to costs. At paragraph [29] of their judgment their Honours described that case in the following terms:

"[29] This is a most unusual case. It involved matters of high public importance and raised questions concerning the liberty of individuals who were unable to take action on their own behalf to determine their rights. There was substantial public and, indeed, international controversy about the Commonwealth's actions. The proceedings provided a forum in which the legal authority of the Commonwealth to act as it did with respect to the rescued people was, and was seen to be, fully considered by the Court and ultimately, albeit by majority, found to exist. The case is quite different in character from the predominantly environmental litigation in which may (sic) of the previous decisions concerning the impact of public interest considerations on costs awards have been made."

[9]        In my view, questions of degree are clearly involved in any consideration of the weight to be accorded to the issue of public interest or importance in the circumstances of an application for costs and, that the matters raised in the subject proceedings could not reasonably be compared to the matters of importance apparently raised in Vadarlis.

[10]      It is my opinion that the public interests associated with the determination of the strike out application are not sufficient to outweigh the general rule that the successful party ought be compensated by the unsuccessful party in respect of costs. It is also my opinion that no other reasons exist for refusing to make appropriate orders as to costs in favour of the Chief Executive. In the circumstances of these proceedings where, as far as I am aware, the Chief Executive has not been required to file any formal material in response to the notice of appeal other than that associated with the strike out application, I intend to limit costs to those of and incidental to the application dealt with by me on 7 November 2006.

Conclusions and Orders

[14]      For the reasons set out above I have concluded that, in the circumstances of the subject proceedings, it is appropriate to make orders as to costs in favour of the Chief Executive. Accordingly, I order that the respondent to the application, Hegira Limited, pay the applicant, the Chief Executive, Department of Natural Resources and Water his costs of and incidental to the application, such costs to be assessed on the standard basis.

RS JONES
MEMBER OF THE LAND COURT