Lif Pty Limited v Wagga Wagga City Council & Anor

[2006] NSWLEC 766

Land and Environment Court

of New South Wales

CITATION:

Lif Pty Limited v Wagga Wagga City Council & Anor [2006] NSWLEC 766

PARTIES:

APPLICANT
Lif Pty Limited
FIRST RESPONDENT
Wagga Wagga City Council
SECOND RESPONDENT
Wagga Mill Pty Limited

FILE NUMBER(S):

40371 of 2006

CORAM:

Jagot J

KEY ISSUES:

Costs :- whether party surrendered to another party and satisfied claim or whether supervening event occurred - no order as to costs where matter resolved by supervening event

LEGISLATION CITED:

Environmental Planning and Assessment Act 1979 s 82A
Land and Environment Court Rules 1996 Pt 11 r 5, Pt 15 r 7

CASES CITED:

City of Sydney Council v Baskaya (2006) NSWLEC 585;
Kiama Council v Grant (2006) 143 LGERA 441;
Liverpool City Council v Australian Friction Industries Pty Limited (2006) NSWLEC 454

DATES OF HEARING:

17/11/2006

EX TEMPORE JUDGMENT DATE:

11/17/2006

LEGAL REPRESENTATIVES:

APPLICANT
P McEwen SC
SOLICITORS
Henry Davis York

FIRST RESPONDENT
Submitting appearance
SOLICITORS
Lindsay Taylor Lawyers

SECOND RESPONDENT
Mr T Robertson SC
SOLICITORS
Gadens Lawyers

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Jagot J

17 November 2006

40371 of 2006

LIF PTY LIMITED
Applicant

WAGGA WAGGA CITY COUNCIL
First Respondent

WAGGA MILL PTY LIMITED
Second Respondent

JUDGMENT

Jagot J:

1 These are proceedings in which both parties seek orders for costs against the other. The proceedings concern a challenge to the validity of a development consent granted by the first respondent to the second respondent for the redevelopment of the Murrumbidgee mill and associated development. The applicant, through its counsel, has undertaken that the proceedings will be discontinued by notice of discontinuance to be filed by 4.00pm today.

2 For its part, the second respondent, the person with the benefit of the first consent, says that it would consent to the discontinuance but on a term – namely, that the discontinuance operate as a defence to further proceedings on the same claim or any claim that is substantially the same. The reason for the second respondent seeking to impose such a term is that, on 1 November 2006, the second respondent obtained a further development consent, somewhat different from the first development consent, but for redevelopment of the Murrumbidgee mill in a form that the second respondent now wishes to carry out.

3 The applicant does not accept the term sought to be imposed by the second respondent and says that the undertaking given is unilaterally to discontinue the class 4 proceedings without consent of the second respondent.

4 The applicant now seeks an order for costs relying on Pt 15 r 7 of the Land and Environment Court Rules 1996, which provides that the Court may order the respondent to pay the costs of proceedings where a respondent satisfies or causes to be satisfied the claim of the applicant after the proceedings have been commenced. The applicant submits that the course of events since the commencement of the proceedings confirms that the second respondent has satisfied the applicant’s claim.

5 The course of events relied upon is that the second respondent, subsequent to the commencement of the proceedings, lodged an application for review of the first development consent under s 82A of the Environmental Planning and Assessment Act 1979, and presumably at some time within the same period, made application for what became the second development consent of 1 November 2006. As it turned out, the second respondent was successful in both obtaining a review of the first consent pursuant to s 82A and in obtaining the second development consent.

6 The applicant says that those circumstances show that it has in substance succeeded in its challenge to the first consent, which the second respondent surrendered on 16 November 2006. Accordingly, the applicant says that it has succeeded, it has had its claim satisfied and it should in the ordinary course be compensated for the costs that it has incurred in having had to commence the class 4 proceedings in order to obtain such satisfaction. The applicant also says that it cannot be the case that it is disentitled from obtaining an order for costs in its favour merely because it has not taken up the second respondent’s offer to incorporate any challenge to the validity of the second development consent in these proceedings. The applicant acknowledges that the issue of any possible challenge to the second development consent simply remains on foot for future determination, but it says it succeeded in these proceedings and therefore it should get a cost order in its favour.

7 The second respondent observes that it is important to recognise that the development, the subject of the first and second consents, is essentially the same. This can be demonstrated by having regard to the two consents and the description in para 13 of the points of claim. In other words, the second respondent says that at this point in time it has a development consent which remains on foot and indeed which it proposes to act upon as soon as it reasonably can. In other words, the second respondent’s actions cannot be characterised as having satisfied the applicant’s claim. This is particularly so, the second respondent says, in circumstances where consideration of the points of claim and points of defence in the proceedings (as well as related correspondence) disclose that the fundamental issues in the proceedings included the permissibility of the proposed development. That is an issue, the second respondent says, which is precisely the same with respect to the second development consent as for the first development consent.

8 This was one of the reasons the second respondent chose to invite the applicant to save the costs that had already been incurred in these proceedings by incorporating any challenge which the applicant might wish to make to the second consent in these proceedings. By that method, the second respondent says, there would be the maximum cost savings for the parties. The second respondent points to that fact and its other conduct in the proceedings as removing any suggestion that it has acted unreasonably, in particular its correspondence of 30 June 2006 (disclosing that, while the second respondent never conceded invalidity of the first consent, it was willing to take steps by the s 82A review to narrow the scope of the issues in the proceedings, because the s 82A review could never have resolved any of the issues relating to permissibility).

9 The second respondent also says that there is no evidence that it surrendered the first consent other than for the reason that it now wishes to proceed with the second consent and the second consent has a deferred condition requiring surrender of the first consent before the second consent becomes operative. Accordingly, the second respondent says that the fact that there has been a surrender of the first consent, which nominally satisfies the applicant’s claim, should not be seen as a substantive satisfaction of that claim as contemplated by Pt 15 r 7. Precisely the same issues remain alive with respect to the second consent, and it may be inferred that the applicant has taken the course of discontinuing these proceedings for its own reasons.

10 In respect of its own application for costs, the second respondent relies on Pt 11 r 5 of the Land and Environment Court Rules, which provides that if a party discontinues proceedings the Court may on application of another party order the discontinuing party to pay the costs of a party against whom the claim was brought and who has not consented to the discontinuance. Here, the second respondent says it offered to consent to the discontinuance on terms which terms were not accepted. Accordingly, Pt 11 r 5 provides a presumption in its favour and the second respondent otherwise relies on the same submissions it made to defend the applicant’s claim for costs.

11 The parties accept the statement of general principles summarised in many of the decisions in this area in Kiama Council v Grant (2006) 143 LGERA 441, in particular at para 80 where Preston J observed that the cases draw a distinction between facts which may be characterised as one party effectively surrendering to the other party and facts where there has been some supervening event or settlement that so removes or modifies the subject of the dispute that no issues remains except that of costs. Those two categories result in different considerations for the exercise of the discretion with respect to costs.

12 The applicant has also drawn my attention to two decisions of Biscoe J, City of Sydney Council v Baskaya (2006) NSWLEC 585 and Liverpool City Council v Australian Friction Industries Pty Limited (2006) NSWLEC 454 in which he determined that both respondents had in fact surrendered to the Council and accordingly the Council was entitled to orders for costs in its favour. However, as I earlier observed it seems to me to be clear from looking at those decisions that both concerned alleged unlawful works or development of some form or another, and that the surrender was clear on the facts because the respondents in both cases had carried out the required work.

13 In this case, the facts are by no means as clear as those that were before Biscoe J. It seems to me that there is force in the second respondent’s submissions that while there has been a nominal satisfaction of the applicant’s claim, the position as it stands today is that the second respondent has a development consent for development of the same property which it intends to act upon. In all of the circumstances relied upon by the second respondent and as set out in Mr Robertson’s submissions to me I am not able to be satisfied in accordance with Pt 15 r 7, that the resolution of these proceedings is because the second respondent has caused to be satisfied the applicant’s claim by reason of the surrender of the first development consent.

14 Although the facts may not as neatly fall within the categories identified by Preston J as one might wish, in circumstances where:

• the second consent remains on foot,
• the second respondent’s position is that it intends to rely upon that development consent,
• the second respondent made an offer to enable these proceedings to be reconstituted without any costs implications so as to allow the applicant to challenge the validity of the second development consent in these proceedings, which offer was not accepted,

the circumstances are readily described as involving some supervening event (namely, the decision of the second respondent that it wishes to avail itself of the second development consent). However the circumstances are characterised, I cannot on the facts find that there has been an effective surrender of position by the second respondent to the applicant.

15 I then come to the issue of Pt 11 r 5. Much for the same reasons, I am of the view that, as Mr Robertson acknowledged, this is a form of defensive application to the applicant’s claim for costs. Having regard to all of the circumstances to which I have referred I am satisfied that in accordance with the rules and the discretion in s 69 of the Land and Environment Court Act, the appropriate order having regard to the discontinuance of these proceedings is that each party should pay its own costs of the class 4 application.

16 I then come to the issue of the costs of today. It seems to me that it is appropriate that the usual order as to costs of today should be made. That is, the applicant has filed and served a notice of motion seeking an order that the second respondent pay the applicant’s costs of these proceedings, being the motion dated 15 November 2006. The second respondent has been wholly successful relating to the defence of that notice of motion and the ordinary compensatory principles with respect to costs should apply and, accordingly, I order:

(1) The applicant’s notice of motion dated 15 November 2006 is dismissed.

(2) The applicant is to pay the second respondent’s costs of that motion as agreed or as assessed.

(3) The second respondent’s motion for costs is dismissed.

(4) Each party is to pay its own costs of the class 4 proceedings.
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