Ocean Shores Community Association Inc v Byron Shire Council (No 5)

[2016] NSWLEC 8

Land and Environment Court

New South Wales

Medium Neutral Citation:	Ocean Shores Community Association Inc v Byron Shire Council (No 5) [2016] NSWLEC 8
Hearing dates:	4 December 2015
Date of orders:	22 February 2016
Decision date:	22 February 2016
Jurisdiction:	Class 4
Before:	Pain J
Decision:	No order for costs.
Catchwords:	COSTS – whether unsuccessful community association in judicial review proceedings should pay costs of Respondent – consideration of public interest costs rule in LEC Rules
Legislation Cited:	Byron Local Environmental Plan 2014 Byron Local Environmental Plan 2014 (Amendment No 2) Civil Procedure Act 2005, s 98 Environmental and Planning Assessment Act 1979, s 35 Land and Environment Court Rules 2007, r 4.2(1) Local Government Act 1993 Uniform Civil Procedure Rules 2005, r 42.2
Cases Cited:	Capital Airport Group Pty Ltd v Director-General of the NSW Department of Planning (No 2) [2011] NSWLEC 83; (2011) LGERA 247 Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2010] NSWLEC 59; (2010) 173 LGERA 280 Friends of Malua Bay Inc v Perkins (No 2) [2014] NSWLEC 172 Fullerton Cove Residents Action Group Inc v Dart Energy Ltd (No 3) [2013] NSWLEC 152 Hastings Point Progress Association Inc v Tweed Shire Council (No 3) [2010] NSWCA 39; (2010) 172 LGERA 157 Ocean Shores Community Association Inc v Byron Shire Council (No 2) [2015] NSWLEC 162 Ocean Shores Community Association Inc v Byron Shire Council (No 3) [2015] NSWLEC 171 Save Little Manly Foreshore Inc v Manly Council [2013] NSWLEC 155; (2013) 198 LGERA 304
Category:	Costs
Parties:	Oceans Shores Community Association Inc (Applicant) Byron Shire Council (First Respondent) Minister Administering the Environmental Planning and Assessment Act 1979 (Second Respondent)
Representation:	COUNSEL: Ms I King (Applicant) Mr A Galasso SC (First Respondent) Ms K Richardson (Second Respondent)   SOLICITORS: Woolf & Associates (Applicant) Marsdens Law Group (First Respondent) Minister for Planning (Second Respondent)
File Number(s):	40906 of 2015

Judgment

Costs Judgment

1. I dismissed the Applicant’s judicial review proceedings in Ocean Shores Community Association Inc v Byron Shire Council (No 3) [2015] NSWLEC 171 (“Ocean Shores (No 3)”). Both Respondents now seek orders that the Applicant pay their costs. The Applicant submits the appropriate costs order is that there be no order as to costs so that effectively each party pays his or its own costs on the basis that the proceedings were brought by the Applicant in the public interest inter alia.

2. The principal issue in the substantive proceedings was the lawfulness of the process under the Environmental Planning and Assessment Act 1979 (NSW) (“EPA Act”) undertaken for the reclassification of land owned by the Council known as the Roundhouse site under the Local Government Act 1993 (NSW). The Applicant alleged unsuccessfully that the Gateway Determination issued under the EPA Act to enable the amendment of the Byron Local Environmental Plan 2014 (“Byron LEP”) to change the classification of the land to operational was invalid. The Applicant alleged the Departmental officer who issued the Gateway Determination did not have a proper delegation to do so. The scope of the order was also challenged.

3. Under s 98 of the Civil Procedure Act 2005 (NSW) the Court has a wide discretion to determine costs. Under r 42.2 of the Uniform Civil Procedure Rules 2005 (NSW) costs generally follow the event unless court rules provide otherwise. The Respondents as the successful parties would usually have a costs order in their favour in the absence of any disentitling conduct. Rule 4.2(1) of the Land and Environment Court Rules 2007 (NSW) is such a rule and is relied on by the Applicant. It states:

4.2   Proceedings brought in the public interest

(1)   The Court may decide not to make an order for the payment of costs against an unsuccessful applicant in any proceedings if it is satisfied that the proceedings have been brought in the public interest.

4. Principles governing the application of the rule were usefully identified by Preston CJ in Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2010] NSWLEC 59; (2010) 173 LGERA 280 (“Caroona”). His Honour reviewed relevant decisions on costs and identified a three-step approach in determining whether to depart from the usual costs rule at [13]:

1. First, can the litigation be characterised as having been brought in the public interest?

2. Secondly, if so, is there “something more” than the mere characterisation of the litigation as being brought in the public interest?

3. Thirdly, are there any countervailing circumstances, including relating to the conduct of the Applicant, which speak against departure from the usual costs rule?

5. Five categories of circumstances were identified citing numerous cases as constituting “something more” at [60]:

1. the litigation raises one or more novel issues of general importance;

2. the litigation has contributed in a material way to the proper understanding, development or administration of the law;

3. the litigation was brought to protect the environment, or some component of it, and the environment, or particular component of it, is of significant value and importance;

4. the litigation affects a significant section of the public; or

5. there was no financial gain to the applicant in bringing the proceedings.

6. Six countervailing considerations identified in the cases, set out at [61], were:

1. the applicant is seeking to vindicate rights of a commercial character and stands to benefit from the litigation;

2. where the applicant is an incorporated association, the private interests of members of the association would be affected, legally or financially, by the outcome of the litigation or the group is a “façade” or vehicle for persons wishing to protect their own commercial interests;

3. the applicant is supported financially by persons or bodies who would benefit from, or would have their legal or financial interests affected by, the outcome of the litigation;

4. the narrowness of the question of public interest raised, such as only involving a discrete point of interpretation without broad ramifications;

5. the applicant “unreasonably pursues or persists with points which have no merit” or issues that were not “eminently arguable”; and

6. there is disentitling conduct of the applicant, such as impropriety or unreasonableness in the conduct of the litigation:

[extensive citations omitted]

7. In Friends of Malua Bay Inc v Perkins (No 2) [2014] NSWLEC 172 Craig J identified that the categories of countervailing circumstances were not closed, at [28].

8. In addition to the affidavit of Ms Mangleson sworn 9 October 2015 relied on earlier in the proceedings to support an urgent ex parte interlocutory injunction application summarised in Ocean Shores Community Association Inc v Byron Shire Council (No 2) [2015] NSWLEC 162 at [4], the Applicant read the affidavit of Mr John Youdan dated 16 October 2015. This affidavit stated that the Applicant has 107 members and attached a certificate of incorporation dated 18 March 2014. Various newspaper reports on discussions by the Council and the Ocean Shores community about the future of the Roundhouse site during 2014 and 2015 and about these court proceedings were annexed.

9. The Roundhouse Site Community Business Plan dated December 2010 prepared by the Roundhouse Action Group was tendered (Exhibit A). That plan was prepared on behalf of the Ocean Shores Community Association (then unincorporated) inter alia. It stated that significant community consultation was undertaken to develop the plan with general agreement that the site should be used for the community and that a cultural centre is the best model for its future use.

10. The Council identified that the mix of proposed uses include businesses such as a coffee shop, restaurant and a hotel/motel.

11. The minutes of Byron Shire Council dated 24 June 2010 concerning the Ocean Shores Roundhouse Subdivision were tendered (Exhibit B). These record the resolution of the Council to defer any decisions regarding the proposed plan for the Roundhouse subdivision for six months to allow an on-site community open day to be organised by the Ocean Shores Community Association.

12. Department of Planning officers expressed reservations about the process for classifying the Roundhouse site to Council officers as recorded in minutes of their meeting held on 16 July 2014 in the combined bundle of documents at Tab [15].

13. Correspondence annexed to the affidavit of Mr Woolf solicitor included letters he sent to the Council dated 21 February 2014 and to Council’s solicitors dated 8 March 2014 concerning the possibility of a public trust existing over the Roundhouse site precluding its reclassification as operational. Mr Woolf made a GIPA request to the Council by letter dated 17 August 2015 and to the Department of Planning by letter dated 17 August 2015. An initial response from the Council was received on 25 August 2015 which referred to open access information requested and stated that an assessment as a formal GIPA request of other information sought was necessary as it was not open access. A further update of progress in locating relevant records was sent by the Council in a letter dated 6 October 2015. Mr Woolf sent a letter dated 7 October 2015 to the Minister for Planning asking about the delegation to the departmental officer who signed the Gateway Determination. An email response from the Department referring to the Administrative Arrangements Order 2014 was sent on 8 October 2015.

14. These judicial review proceedings were commenced on 9 October 2015 the second last day they could be commenced under the time limit for such proceedings specified in s 35 of the EPA Act.

Applicant’s submissions

15. The Applicant is a community group which as an incorporated association brought the proceedings challenging the validity of the Byron LEP. The Association has 107 members and the degree of public interest in court proceedings can be reflected in the media attention the proceedings have received per Save Little Manly Foreshore Incorporated v Manly Council [2013] NSWLEC 155; (2013) 198 LGERA 304 at [16]. The Council asked the Applicant to prepare a community business plan in relation to the site the subject of the proceedings by Resolution 10-497 of 2 June 2010.

16. The Applicant’s case is that “something more” is demonstrated through the following features of this litigation:

1. that the Council had previously asked the Applicant for its input into the site the subject of these proceedings and that in response to that request the Applicant had assisted in the preparation of the Business Plan (additional to Caroona);

2. the litigation concerned the interpretation of an Executive Order which had not previously been the subject of any litigation, and thus has contributed to the proper understanding and administration of the law (Caroona at [60(a)]);

3. that the Department of Planning and Environment had expressed concerns prior to the commencement of the ligation as to the “legal mechanisms” proposed to enable the sale of the land the subject of these proceedings (additional to Caroona at [60(b)]);

4. that if the Applicant had been successful in the proceedings, the Roundhouse site would have remained classified as community land, and that in recent surveys of local opinion in the Community Business Plan as to the use of the site there has been an overwhelming opinion expressed that it remain as community or public land (Caroona at [60(d)]);

5. that 176 written submissions were received at the public hearing in relation to the proposed re-classification of the subject land (Caroona at [60(d)]);

6. the litigation was brought to protect the environment of Ocean Shores as properly viewed in its social, economic and cultural context (Caroona at [60(c)]);

7. that the Applicant is a community group that stood to make no pecuniary gain in relation to the proceedings (Caroona at [60(e)]); and

8. that the proceedings would have had a very significant impact on the potential provision of community services in the largest town in the Byron Shire (Caroona at [60(c)]).

17. The Court’s broad discretion on costs under r 4.2 of the Land and Environment Court Rules should be exercised to make no order as to costs.

First Respondent’s submissions (Byron Shire Council)

18. As observed by Young JA at [48] in Hastings Point Progress Association Inc v Tweed Shire Council (No 3) [2010] NSWCA 39; (2010) 172 LGERA 157 courts must be careful that the concept of public interest litigation does not become an umbrella for the exercise of discretion on costs in an unprincipled and haphazard and unjudicial manner. Caroona provides a principled approach. The Applicant must establish more than that the litigation is in the public interest. The onus lies on the Applicant to establish that the matter is in the public interest. More is required than Ms Mangelson’s assertion. The affidavit of Mr Youdan simply annexes the certificate of incorporation and newspaper articles. The number of members should be considered in light of the number of people in the Byron shire who potentially benefit by the sale of the subject lands.

19. The second step requires an examination of the nature, extent and other features of the public interest involved in the litigation to ascertain whether or not they justify in this case the departure from the usual costs rule. None of Caroona at [60(a)-(d)] (see also Fullerton Cove Residents Action Group Inc v Dart Energy Ltd (No 3) [2013] NSWLEC 152 (“Fullerton Cove”) at [33]) something more factors are made out by the Applicant. The delegation issues may be novel but were not of general importance reflecting simply a transition period in departmental labels. No environmental protection matter was in issue but whether certain land had community classification. The land never operated as community land and was vacant.

20. The Applicant was asked for input in 2010 as seen in the business plan and the open day request from the Council. That the Applicant has been part of the Council’s process for decision-making about the Roundhouse site such as preparing a business plan and running an open day does not equate to any likelihood of outcome and provide it with any particular status. One hundred and seven members do not constitute the public.

21. The Council has determined that the site should be sold to fund other infrastructure in Byron Shire as identified in the mayor’s statements in a news report attached to Mr Youdan’s affidavit. The Council is also serving an aspect of the public interest in doing so for the wider benefit of Byron Shire including Ocean Shores. The Council clearly determined not to proceed with the recommendations of the business plan. The Applicant does not agree with the merits of the Council’s decision about the site.

22. There are countervailing circumstances. There was delay in commencing proceedings resulting in an impact on third parties, the incoming purchasers of the subdivided lots who exchanged contracts for sale with the Council but which the Council could not then complete as the Court issued an interlocutory injunction preventing the sales continuing.

Second Respondent’s submissions (Minister)

23. The bare assertion of public interest lacks supportive evidence (first step). No something more arises in terms of the matters identified in Caroona at [60], Fullerton Cove at [33]. No novel issue of general importance was raised, the litigation was not brought to protect any aspect of the environment of significant importance and does not affect a significant section of the public.

24. The ultimate relief sought in the Summons was a declaration that the land the subject of the proceedings was community land for the purposes of the Local Government Act. The legal status of the land does not have any immediate effect on any aspect of the environment. For example, the land remains zoned for residential purposes under the relevant local environmental plan. Following from this proposition, the general public would not be affected by the litigation aside from those persons who had entered contracts to purchase lots of the subject land.

25. The reliance on views expressed by departmental representatives at a meeting with the Council in 2010 at an early stage of the process is irrelevant. They are not the views of the Minister. The issuing of the Gateway Determination suggests any concerns were resolved.

26. There are countervailing circumstances (third step). The basis of the challenge to the validity of the Byron LEP amendment was that the Gateway Determination made on 7 November 2014 was invalid. These proceedings could have been brought well before the conclusion of the Byron LEP making process with the making of the Byron LEP amendment on 10 July 2015, see for example, Capital Airport Group Pty Ltd v DG of NSW Department of Planning (No 2). The Gateway Determination was placed on public exhibition between 29 January 2015 and March 2015 with the planning proposal by the Council. The instrument of delegation was gazetted as was the Administrative Order. No GIPA process was required to identify these documents. Any alleged error could have been raised much earlier saving significant time and cost in relation to the planning proposal and the making of the Byron LEP. The Applicant sat on its hands for a year and allowed an expensive statutory process to proceed, the making of the Byron LEP and entry into the contract for sale of the lots causing maximum costs to be incurred including in seeking an urgent interlocutory injunction.

27. The Applicant had its solicitor engaged in considering the status of the land in 2014, (see Woolf letters dated 21 February 2014 and 18 March 2014). The Applicant through its solicitor was engaged in challenging the process, and should have acted earlier. The Applicant’s submission that it was entitled to wait and participate in the public consultation process on the Byron LEP amendment undermines its submission that it is motivated by testing environmental law. There is no warrant to depart from the usual rule that costs follow the event.

No order for costs to be made

28. I will apply the principles identified in Caroona in the context of r 4.2 of the Land and Environment Court Rules as set out above in par [4]. That the Applicant considers it is acting in the public interest must be established beyond assertion to that effect. The evidence of Mr Youdan demonstrates that it seeks to preserve the Roundhouse site as community land for cultural and other purposes. I can accept again as I found in the interlocutory proceedings that the Applicant has acted in the public interest in the context of planning for community facilities in Ocean Shores. Its concerns are demonstrated through its ongoing involvement in the planning for the Roundhouse site such as orchestrating the preparation of a business plan to present to the Council in December 2010.

29. The Council as owner of the land wishes to sell it for residential use to fund other infrastructure throughout the Byron shire which benefits potentially citizens across the shire and is a matter clearly within the functions of the Council. This is not a case where the public interest lies exclusively in the Applicant’s domain.

30. Various facets of public interest were helpfully discussed in Caroona at [24]-[26], in the context of recognising that sustainable development requires the balancing of environmental protection, social development and economic development. Chief Justice Preston identified at [27]-[34] the need for courts to ensure access to justice for citizens seeking to remedy or restrain a breach of environmental law through recognising that the cost of litigation is a practical barrier to such action so that this aspect of the public interest may be unrepresented or under-represented in the courts.

31. Not all of the factors relied on by the Applicant enable it to establish the something more. That it had an ongoing and active interest in the issue does not assist in this aspect of the matter, being more supportive of the finding above that the Applicant is motivated by a public interest. That departmental officials expressed concern at an early stage is irrelevant as this was clearly overcome with the issuing of the Gateway Determination by the Minister’s delegate within the department. Whether the Applicant can claim that the proceedings would have had an impact on the potential provision of community services is debateable given that the Council owns the land and it is zoned for residential subdivision.

28. I accept that a large number of residents in the Ocean Shores area were concerned about the retention of the Roundhouse site as community land, (Caroona at [60(d)]). The Applicant stood to make no financial gain from the proceedings (Caroona at [60(e)]). The issue of the scope of the delegation power identified in the Applicant’s case had not been identified before (Caroona at [60(b)]).

29. Countervailing circumstances identified by the Respondents allege delay in commencing these proceedings. I don’t consider this is legitimate criticism by the Respondents. The Applicant did commence proceedings late within the statutory time period of three months and the main focus of its challenge was the Gateway Determination made in late November 2014 and placed on public exhibition in January 2015. The Applicant wished to participate in the public consultation process concerning the Byron LEP amendment and presumably influence the outcome in a manner favourable to its point of view. If successful in influencing that process in theory there would be no need for this judicial review challenge. The Minister’s submission that Mr Woolf had advised the Applicant earlier in 2014 and could have done so at the time of the Gateway Determination also assumes that a group such as the Applicant community association has the resources for a lawyer on standby at all times but that is unrealistic for many such groups.

30. This matter was dealt with efficiently given the limited focus of the Applicant’s judicial review challenge. Proceedings were commenced and an interlocutory injunction granted on 9 October 2015, expedition was granted and a final hearing occurred on 20 October 2015 with delivery of Ocean Shores (No 3) on 30 October 2015.

31. Weighing up all these circumstances and considerations in the exercise of my discretion I consider each party should pay its costs of the proceedings. No order for costs will be made.

Decision last updated: 23 February 2016