Meehan v North Sydney Council

No judgment structure available for this case.

Land and Environment Court

of New South Wales

CITATION: Meehan v North Sydney Council [2006] NSWLEC 598

PARTIES:
APPLICANT
MM Meehan
RESPONDENT
North Sydney Council

FILE NUMBER(S): 10945 of 2004

CORAM: Murrell C

KEY ISSUES: Costs :-

LEGISLATION CITED: Environmental Planning and Assessment Act 1979
Land and Environment Court Act 1979

DATES OF HEARING: Written submissions on costs
2 and 8 November 2005, 6, 8, 9 & 13 February 2006,

DATE OF JUDGMENT:
09/25/2006

LEGAL REPRESENTATIVES:
APPLICANT
Mr J. Bingham, solicitor and
Ms Z. Baker, solicitor
of Deacons
RESPONDENT
Ms G. Furness, barrister
Instructed by: Ms E. Glancey
of Mallesons Stephen Jaques

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Murrell C

Date 25 September 2006

10945 of 2004 M M Meehan v North Sydney Council

JUDGMENT ON PROVISIONAL COSTS
Summary

1 Previous judgments in this matter were for the class 1 merits appeal against the decision of North Sydney Council to refuse a development application for alterations and additions to a heritage item at No. 40 Kirribilli Avenue, Kirribilli. [Meehan v North Sydney Council (2005) NSWLEC 710 and 773] The appeal was ultimately upheld following adjournments and amended plans on two occasions.

2 This judgment is for costs in the proceedings that commenced prior to the 23 December 2005 change to the Practice Direction and since that time costs in class 1 merits appeal are now only heard by Judges of this Court. The former Practice Direction sets out the procedure to be followed by Commissioners, and this provides the opportunity for parties to make submissions to the Chief Judge who makes the final decision on costs.

3 In summary, the council is seeking the applicant pay its costs in the fixed sum of $56,000. The applicant considers this claim is excessive and the respondent should be required to provide particulars of its costs in the proper form or no further costs be ordered. Alternatively the applicant submits if the Court accepts the respondent’s ‘breakdown of costs’ document then costs should only be made in respect of: the vacation of the hearing date, 22 November 2004, in the sum of $3,265; costs of assessment of amended plans (option B) in the sum of $6,631. This provides a total sum of $9,896. In addition the applicant also accepts it is required to meet both parties’ share of the Court-appointed-expert’s fee from 16 June 2005 of $3,640 and this has been paid. It is noted that this amount is not included in the council’s claim of a fixed sum of $56,000.)

4 After having considered the parties’ submissions on costs, I propose to make an order, subject to obtaining the concurrence of the Chief Judge, that the applicant pay the respondent’s costs in the amount of $26,000.

Background

5 It is appropriate to set out a chronology of events as background to the claim for costs. While amended plans were ultimately approved by the Court, the proceedings were marked by unusual events.

6 Before the class 1 merits hearing commenced before me the issue of costs was raised when vacation of the first hearing date was mentioned before his Honour Talbot J on 12 November 2004 and orders were made including that the hearing date 22 Nov 2004 be vacated; and that the applicant pay the respondent’s costs ‘thrown away’ as a consequence of the vacation of the hearing date.

7 Two further mentions before the merits hearing were heard by his Honour McClellan CJ on the 7 December 2004 and 16 February 2005 in respect of amended plans. On 16 February 2005 McClellan CJ gave leave to rely on the amended plans and commented:

8 Mr Bingham on behalf of the applicant accepted this cost. His Honour further commented “if there's any true reassessment costs over and above what would have been reasonable then I'd look at those costs as well”.

9 The amended plans in February 2005 and prior to the merits hearing were in response to the Court appointed expert’s initial assessment. At that time two options ( A and B) were then proposed and comments provided by the CAE. The applicant then decided to proceed to hearing on the option B plans.

10 The hearing on option B was in April 2005, and the Court made findings on 16 June 2005 and found that the part of the proposed extension, that is for a third bedroom at the first floor level, should be deleted because of the adverse amenity impacts on the conservatory of the adjoining terrace at No. 42. At the time of these findings the applicant was given the opportunity to submit an amended plan to reconfigure the rooms within the envelope the Court determined as appropriate. The applicant did choose to submit an amended plan that was then the subject of further evidence and hearing time in the proceedings.

11 It is noted that the Council refused the application in May 2004 for a number of reasons including on heritage grounds. The Court in its determination found the application to be unsatisfactory not for heritage reasons but rather that the first floor bedroom should be deleted because of adverse amenity impacts on the adjoining property. Apart from this, the Court found the internal alterations that the Council took issue with on heritage grounds, were acceptable.

12 The matter came before me again on 28 July 2005 and option ‘C’ plans were tendered to which the council raised no objection. However Ms Furness for the council stated “the only issue is in relation to the requirement of consent from the neighbouring property No. 42 if it is that the new retaining wall which is described extends beyond the boundary of number 40 into number 42 and there is no consent from the owners of 42”. Mr Bingham responded :

“…the need to stand the hearing over so that we can have geotech and structural engineering evidence because we have an amended statement of issues now from the council putting that question of excavation in support of the adjoining building in issue… and in light of the Court appointed heritage expert's report which we only got at 5.30pm last night”.
“

13 For the respondent Ms Furness stated:

“Now the issue of excavation and in particular the fact that the consent of the owners of the adjoining property had not been obtained was raised by the Council in the statement of Mr Mossemenear, his statement was filed and served on 14 July 2005…It’s clear Commissioner from that statement, which as I say was filed and served two weeks ago, that the question of the impact of the excavation firstly and secondly the fact that consent had not been obtained from the owner was raised fairly and squarely in that report… which specifically refers to the underpinning on and over the boundary. So I note that the issue of excavation and the consequences in terms of consent was raised early on by the council. Now in relation to the issue of heritage, it is of course the case as my friend indicated that both parties received Mr Logan’s report at about six o’clock last night and it is the position of the council that it accepts the report of Mr Logan‘s….Accordingly the council requires no further time in respect of the issue of heritage…however, should the applicant wish the opportunity for the heritage expert to confer with Mr Logan we certainly wouldn’t stand in the way of that, however given that Mr Staas would be involved and Commissioner will recall that Mr Davies gave evidence on behalf of the council last time we would expect that Mr Davies would be invited to that conference as well.”

14 Following further discussion about the need for an adjournment I indicated I was minded to allow an adjournment but at the same time the applicant should provide an indication as to the payment of certain costs of the respondent. At this point I briefly adjourned to allow the parties to discuss the issue of costs and Mr Bingham advised that ”the applicant is prepared to meet Mr Logan's costs of considering and assessing the amended drawings including his further costs in relation to the amendments”. Ms Furness informed the Court she had instructions at the appropriate time to apply for costs in relation to aspects of the proceedings. And she submitted:

“there is clearly a question as to the costs thrown away from today and the preparation for today which was prepared on the basis that Commissioner you would consider the written material and come to a view … Now by not making formal application today Commissioner I wouldn't want it to be thought that the council is abandoning any right that it has with respect to costs concerning the most recent amendment of plans and in the event commissioner that you would wish to be addressed in relation to costs concerning today I'm happy to do so. I had in mind thought it better to deal with it at the end of the proceedings because there had been so many aspects of these proceedings where costs will clearly be in issue…”.

15 Before adjourning on 28 July 2005 the Court requested the parties discuss the matter and for a costs schedule to be provided to assist in the process before final submissions. The Court also commented that the issue of costs for the further amended plans in hindsight should have been raised when the Court handed down its findings in June, but at that time the Court also did not foresee a reconfiguration of the space to include excavation to accommodate another level as now shown in the amended plans.

16 At the hearing in November 2005, the parties requested that the issue of costs be deferred again, this time to allow for written submissions and the Court directed submissions on costs to be filed in December. I proceeded to judgment [2005 NSWLEC 710] and upheld the appeal based on the further amended plans submitted to the Court in response to the findings of 16 June and reserved the question of costs. The partes by e-court then sought an extension to this date and submissions were filed in February 2006.

Submissions on costs

17 The written submissions on costs are marked as Exhibits 22,23, 24 ,P and Q.

18 Before the final hearing day an affidavit of Ms Mary Elizabeth Glancey was filed with the Court on 2 November 2004 (exhibit 22). . This refers to 10 sets of amended plans, conference meetings of experts, adjournments, mentions and provides a table of invoices issued by Messrs Mallesons Stephen Jacques to the respondent up to the date of the affidavit. The fees and disbursements charged in the invoices total $58,276.78 consisting of $39,485.00 in legal fees and $18,791.78 in disbursements to include Counsel’s fees and the fees charged by the Court-appointed expert.

19 The total fees and disbursements charged to the respondent including GST total $64,104.48. She also states that:

I am informed and believe that the respondent’s officers Mr Mossemenear and Ms Varley have spent a substantial amount of time assessing each amended drawing, preparing statements of evidence, attending meetings and providing instructions in this appeal.
In addition, Mr Panuccio, the respondent’s employed legal officer provided instructions. These costs are not being claimed by the respondent.

…If the proceedings had been discontinued in or around 1 November 2004 after Mr Logan’s initial advice had been given, and the matter had proceeded by way of a …development application to the council without a further appeal to the Land and Environment Court, I estimate that the total legal costs and disbursements incurred by the respondent would have been approximately $8,000.00 including GST.

20 The applicant’s Exhibit P is in response to the respondent’s exhibit 22, Ms Glancey’s affidavit claiming the applicant had submitted 10 sets of plans and the respondent’s letter seeking an order for all costs of and incidental to the proceedings to the sum of $64,000. The applicant submits that:

21 The respondent in its later submission of 6 February submission, paragraph 9, seeks costs orders:

22 The respondent’s submission states that the primary issue in the proceedings was the proposed first floor addition at the rear to a heritage listed property that the council had consistently opposed and which was also not supported by either the Court-appointed heritage expert or the Court and that the applicant was proposing an irrational or ambit claim with respect to the initial first floor addition. The respondent claims the 10 amended versions of the plan that were required to be copied and distributed to Council officers and residents consequently incurring additional costs.

23 The respondents further submission of 13 February 2006 seeks a total cost of $56,000. Alternatively "if the Court considers that a costs order or orders should not be made for a fixed sum it is submitted that orders should be made requiring that the applicant pay the respondents costs as agreed or assessed for a particular part or parts of the proceedings …”

24 The respondent states that:

“It is implicit in the comments of the Chief Judge on 7 December 2004 and 16 February 2005 and the agreement by the applicant to pay the costs of the Court-appointed expert from June 2005 that the further amendments resulted in costs, which should not be borne by the Council.

The Council submits it should be awarded costs of the work undertaken with respect to this costs application in the fixed sum amount of $56,000.00 exclusive of the Court-appointed experts costs for 16 June 2005 to date.”

25 The applicant’s submission on costs was filed 8 February 2006 wherein it is submitted that:

26 The applicant submits that the respondent should provide particulars of its costs in the proper form or no further costs be ordered. Alternatively, the applicant submits, to resolve the matter, the applicant accepts only the following in the respondent’s ‘breakdown of costs’ schedule:

The respondent’s costs thrown away as a consequence of the vacation of the hearing date $3,265 ;

The respondent’s costs of the CAE assessing the amended plans (option B) of February 2005 - $6,631; and

the Court-appointed expert’s fees from the date of the preliminary findings in June 2005, the total of which has already been paid, -$3,640.

Assessment of Costs

27 To guide my assessment of costs I refer to the cases of the Chief Judge Preston CJ in Grant v Kiama Municipal Council [2006]NSWLEC 70 and Vigor Master Pty Ltd v Warringah Council [2006] NSWLEC 140 wherein his Honour provides the approach to costs in class 1 proceedings. In Vigor Master Preston CJ said:

Environmental Planning and Assessment Act

1979

Approach to costs in Class 1 proceedings

15. The approach embodied in Pt 16 r 4(2) of the Rules is that an order for costs will not be made in Class 1 proceedings unless the Court considers the making of a costs order is, in the circumstances of particular case, fair and reasonable.

16. I summarised many of the circumstances where courts have considered it would be fair and reasonable to make an orders for costs in Class 1 proceedings in Grant v Kiama Municipal Council [2006] NSWLEC 70 (22 February 2006), [15].
…
42. Accordingly, the case did not fall into the category of a Class 1 appeal that had no chance or very poor prospects of success: Grant v Kiama Municipal Council [2006] NSWLEC 70 (22 February 2006): [15(f)] and cases cited therein.
…
47. The conduct of the applicant in persevering with the hearing of the appeal after having receiving an unfavourable oral report by the court appointed expert was also not unreasonable. The parties’ common position was that the Court had a discretion to grant consent. The court appointed experts’ opinion was but one piece of evidence in that hearing. It was countered by the opinion of the applicant’s expert…. It was not unreasonable for the applicant to seek the adjudication by the Court of the issue, having regard to all of the competing expert evidence.
…

Grant v Kiama Municipal Council

28 From the background provided above these proceedings involved amended sets of plans on two occasions (with three sets of plans) and this must be taken into consideration in assessing what is a fair and reasonable proportion to award for costs. However, it is acknowledged that before the second set there were two options proposed that the CAE provided comments on before the applicant decided to make option B the subject of the hearing.

29 The respondent is claiming costs for nearly the whole of the proceedings on the basis that the Court did not approve the first floor extension that it had consistently opposed, and later opposed by the CAE on heritage. However, it would not be ‘fair or reasonable’ to penalise an applicant for appealing council’s decision as costs in class 1 should be compensatory.

30 Applicants have recourse to the Court when they are not satisfied with council’s decision and the fact the Court’s decision resulted in the deletion of one element of the proposal that the respondent also did not find satisfactory does not provide for an automatic awarding of costs against the applicant. Furthermore the Court’s reason for not allowing the first floor addition was due to amenity impacts on the conservatory at ground level of the adjoining property and not on heritage grounds. The Court also found the other alterations and additions as satisfactory where these were also contested by the respondent. It is also noted that the respondent sought, and was granted leave before the hearing in April 2005, for its own heritage officer to give evidence, however, the Court did not accept her opinion in respect of the internal alterations and additions to the building and the Court found these to be satisfactory.

31 In determining fair and reasonable costs it must also be noted that the application finally approved by the Court evolved during the course of the hearing. This resulted in the respondent incurring not only costs thrown away but additional costs as additional hearing time and assessment was required.

32 The respondent’s ‘breakdown of costs’ at exhibit 23 includes 12 items. However, in the general description of work undertaken this includes matters that the applicant should not be required to pay as ‘fair and reasonable’. For example: under item 3 - amending the Statement of Issues to include new matter raised by the Court-appointed expert; under item 7 settling draft reports by council officers, Mr Mossemenear, Mr Davies and Ms Varley.

33 On the question of the number of amended plans during the course of the hearing I have examined the plans as contained in the respondent's folder (part of exhibit 24) and this reveals that there are not ten sets of plans. In my assessment it is not only unhelpful to refer to 10 sets of amended plans but, as submitted by the applicant, “an exaggeration”. At the same time the applicant accepts there were three sets of plans the subject of the proceedings. Clearly on an examination it can be seen that a number of sheets merely supplement a previous set of plans. Following the CAE’s comments the applicant amended the plans against which the appeal was lodged (the first set of plans) with the consequence that the first hearing date was vacated in November 2004. The applicant then proposed two options, A and B, for comment by the CAE and then proceeded to hearing having elected to rely on option B , the second set of plans. The third set of plans was submitted in response to the findings of the Court in June 2005.

34 The applicant, decided to take the opportunity and submit the further amended plans (the third set) and it is fair and reasonable for the applicant to pay for certain costs associated with the additional hearing time and assessment. This is shown in the respondent’s breakdown of costs, items 9 and 10 in exhibit 23. It would appear, however, that some of the preparatory work for both dates, 28 July when the matter was stood over to 17 November, would be similar and the claim for total costs for the two days appears to be unreasonable to impose on the applicant. However, it is acknowledged that the applicant should make a significant contribution to the above legal costs. The applicant accepts and has already paid the CAE for the assessment of the above (third set of) plans from the date of the Court’s findings in June.

35 Having regard to the Court's discretion under section 69(2) of the Land and Environment Court Act 1979, the applicant should pay the respondent's costs for the items identified in the mentions before McClellan CJ and the Court Orders of Talbot J. In addition the applicant should pay the costs ‘thrown away’ for 28 July 2005 when the applicant requested the matter be stood over. It is noted the council’s concerns had been communicated to the applicant well before this date and the late arrival of the CAE’s report would not warrant an adjournment.

36 However, I do not accept the quantum of $56,000 claimed, or party-client costs, to be reasonable. Rather costs associated with: the amended plans prior to the merits hearing including the CAE (for options A and B); the costs incurred as a consequence of the vacation of the hearing dates of 22nd of November 2004 and 28 July 2005; a large part of the costs of the hearing and assessment for the third set of plans; and a commensurate proportion of the costs for the preparation of the submissions on costs, should be awarded to the council.

37 It is clearly in the interests of the parties that the costs now be determined on the basis of the information at hand. In my overall assessment of ‘fair and reasonable’, having regard to the parties’ submissions and the circumstances of the case, I consider that the applicant should pay the respondent a quantum of $26,000 towards its costs incurred during the course of these lengthy proceedings. This generally represents what can be described as the additional costs incurred as a consequence of the amended plans and costs ‘thrown away’ in vacating hearing dates as identified below.

1. the applicant is to pay the respondent’s costs, as ordered by the Court 12 November 2004, as a consequence of the hearing date on 24 November 2004 being vacated, in the sum of $7,000 (item 12 p.6 of attachment to Exhibit 23);

2. the applicant is to pay the respondent’s share of the CAE’s fee for the assessment of options A & B, in the sum of $6,600 (item 12 p.6 of attachment $1,148 and $5,453);

3. the applicant is to pay the respondent’s costs ‘thrown away’ as a result of the applicant’s request for “the matter to be stood over” on the morning of the hearing, 28 July 2005. This is to be in the sum of $5,711 (item 9 p.4 of attachment ) ;

4. the applicant is to pay the disbursements costs of $2,294 for the final hearing date of 17November 2005, this includes counsel’s fees;
5. the applicant is to pay part of the respondent’s costs for preparation of the costs submissions in the sum of $4,400 from a total of $9,646 claimed (p.5 of attachment ).

38 Accordingly I propose to seek the concurrence of the Chief Judge pursuant to s69(8) of the Land and Environment Court Act 1979 to the making of the following costs order:

1. the applicant is to pay the respondent’s costs in the sum of $21,600 ;
2. the applicant is to pay the respondent’s costs of the motion for costs in the sum of $4,400;
3. the above sums are to be paid to the respondent within 21 days.

39 The parties have 14 days to either make a written submission, or apply to make oral submissions, to the Chief Judge on the findings above before his Honour exercises his power of concurrence for the making of the costs order.

40 On the making of the Order for Costs, the exhibits in the proceedings are to be returned to the parties with the exception of Exhibit J.

_____________
J S Murrell
Commissioner of the Court
Ljr/jsm

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Citations

Meehan v North Sydney Council [2006] NSWLEC 598

Cases Citing This Decision

0

Cases Cited

3

Statutory Material Cited

2

Meehan v North Sydney Council [2005] NSWLEC 710

Vigor Master Pty Limited v Warringah Council [2006] NSWLEC 140

Grant v Kiama Municipal Council [2006] NSWLEC 70

CITATION:	Meehan v North Sydney Council [2006] NSWLEC 598
PARTIES:	APPLICANT MM Meehan RESPONDENT North Sydney Council
FILE NUMBER(S):	10945 of 2004
CORAM:	Murrell C
KEY ISSUES:	Costs :-
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979 Land and Environment Court Act 1979
DATES OF HEARING:	Written submissions on costs 2 and 8 November 2005, 6, 8, 9 & 13 February 2006,
DATE OF JUDGMENT:	09/25/2006
LEGAL REPRESENTATIVES:	APPLICANT Mr J. Bingham, solicitor and Ms Z. Baker, solicitor of Deacons RESPONDENT Ms G. Furness, barrister Instructed by: Ms E. Glancey of Mallesons Stephen Jaques

[2006] NSWLEC 598

25/09/2006