Owners Corporation - Strata Plan 18910 v Starkey
[2000] NSWSC 74
•23 February 2000
CITATION: Owners Corporation - Strata Plan 18910 v Starkey & Ors [2000] NSWSC 74 CURRENT JURISDICTION: Equity FILE NUMBER(S): SC 1118/2000 HEARING DATE(S): 4 and 11 February 2000 JUDGMENT DATE: 23 February 2000 PARTIES :
Owners Corporation - Strata Plan 18910 (Plaintiff)
Laurie Starkey (First Defendant)
Anthony Aitken Petley (Second Defendant)
Janette Ivy Petley (Third Defendant)
Owners Corporation - Strata Plan 19898 (Fourth Defendant)JUDGMENT OF: Bergin J
COUNSEL : Mr M Bradford (Plaintiff)
Ms A Beardow Solicitor (First Defendant)
Ms A Pearman (Second and Third Defendant)
Mr P Russell (Fourth Defendant)SOLICITORS: Alex Ilkin & Co (Plaintiff)
Phillips Fox (First Defendant)
Levy Peatman (Second and Third Defendants)
Tress Cocks & Maddox (Fourth Defendant)CATCHWORDS: Transfer of proceedings to the District Court - Power of District Court to award costs incurred prior to transfer. LEGISLATION CITED: Supreme Court Act 1970
Supreme Court Rules
District Court Act 1973
District Court Rules Part 5 r 13CASES CITED: Pelechowski v Registrar, Court of Appeal (1999) 162 ALR 336. DECISION: Proceedings transferred to District Court. Costs reserved.
THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
EXPEDITION LISTBERGIN J
DATE 23 FEBRUARY 2000
1118/2000 - OWNERS CORPORATION - STRATA PLAN 18910 v STARKEY & ORS
JUDGMENT
1 This litigation has been generated by a dispute in relation to four mature Eucalyptus Microcorys (gum trees) in the suburb of Marsfield, New South Wales. Two of the gum trees were on the property of Townhouse 21, 178-182 Waterloo Road, Marsfield, which is owned by the first defendant, Mr Laurie Starkey. The other two gum trees were on the property of Townhouse 20, 178-182 Waterloo Road, Marsfield, which is owned by Mr Anthony and Mrs Janette Petley, the second and third defendants respectively.
2 The gum trees were apparently planted in the 1970s and in February 1999 stood some 15 metres tall. They apparently had “many years of vigorous growth to endure” as they were considered young trees which had the potential to grow to 33 metres in height and 2 to 3 metres in girth at the base.
3 There is a retaining wall along the boundary of the Townhouse complex. The Owners Corporation-Strata Plan 19798, the fourth defendant, is the Strata Plan for the Townhouse complex which includes Townhouses 20 and 21.
4 The neighbouring property, 7-9 Brunton Place, Marsfield, is also of a Townhouse complex the relevant Strata Plan for which is Owners Corporation - Strata Plan 18910, the plaintiff in these proceedings.
5 The majority of parties have a managing agent. The plaintiff’s agent is Noelene Haile Real Estate at Epping (Haile). The second and third defendants’ agent is Jackson & Rowe Pty Ltd at Ryde (Jackson & Rowe). The fourth defendant’s agent is Gilmour Strata Management at Parramatta (Gilmour).
History of the Dispute
6 For the purposes of the issues for decision the matter can be summarised as follows:
· In early 1997 Ms Galton, who is the Chairperson of the plaintiff, first observed what she regarded as signs of stress on the retaining wall on the common property of the Townhouse complex at 7-9 Brunton Place Marsfield. She immediately contacted Haile and instructed it to correspond with Gilmour. Gilmour wrote to Haile on 19 February 1997 in the following terms:
We act as managing agents for Strata Plan 19798, 178-182 Waterloo Road, Marsfield, and authorise you to approach Ryde Council on our mutual behalf with a view to obtaining a permit for removal of the tree which is growing in Townhouse 21 of 178-182 Waterloo Road, and which is damaging the common retaining wall between the above two properties.
Once the permit has been received from Ryde Council to remove this tree then we will make further arrangements with you for the removal of the tree and repair of the common retaining wall.
· Between early 1997 and June 1998 Haile and Gilmour attempted to obtain consent from the Ryde City Council for the removal of the tree to which reference was made in the letter from Gilmour to Haile of 19 February. The Ryde City Council informed Haile, and Haile subsequently informed Gilmour, that it was necessary for Mr Starkey to lodge a personal application for the removal of the tree as it was on his property. It is apparent that Mr Starkey did not make such an application during 1997 or 1998.
· During 1997 and 1998 engineers were instructed by a number of the parties, each of whom expressed concerns about the safety (or lack thereof) of the situation. Various recommendations were put forward with alternative quotations for the anchoring of walls, the removal of trees, the pruning of trees and excavation and placement of galvanised dowels.
· In August 1998 the fourth defendant notified the plaintiff that it had obtained legal opinion that it was not liable to contribute towards rectification of the retaining wall or the removal of the trees.
· By late 1998 Haile asked Ryde City Council to inspect the premises and report to it. In November 1998 Ryde City Council advised Haile that it did not wish to become involved in the disputation between the parties that had arisen and suggested to Haile that it might approach the local Community Justice Centre.
· By April 1999 the plaintiff instructed Alex Ilkin, solicitor, who wrote to the fourth defendant and Mr Starkey, the first defendant, referring back to the original letter of 19 February 1997 and to the fact that Mr Starkey had apparently refused to consent to the removal of the tree. Mr Ilkin enclosed an engineer’s report and claimed that by reason of the first and fourth defendants’ refusal to agree to the trees being removed further damage was occurring.
· Mr Robinson, solicitor for the fourth defendant, advised Mr Ilkin that he was instructed to try to settle the matter, authorised to offer 50% of the cost of stabilising the wall and undertook to remove the offending trees within 60 days, subject to Council approval. This offer was the subject of a request for clarification from Mr Ilkin as to which party was making the offer and the particular costs that would be shared.
· On 27 August 1999 LAC Loss Adjusters, acting for the public liability insurer of the fourth defendant, advised the plaintiff that it had completed preliminary investigation of the property and asked the plaintiff to refrain from further action whilst the principal had time to consider the matter.
· In August 1999 the second and third defendants were brought into the dispute for the first time. Mr Ilkin advised Mr and Mrs Petley of the problems with the retaining wall and alleged that the two gum trees on their property were causing damage to the wall and creating a dangerous situation. Mr and Mrs Petley were asked to agree to the removal of the trees and to join in the settlement of the matter with the first and fourth defendants.
· The second and third defendants’ solicitors, Messrs Levy Peatman, responded fairly promptly in the first week of September 1999 and requested a month to review the matter and take proper instructions. Thereafter Messrs Levy Peatman seemed to keep the plaintiff well-informed of what was occurring.
· On 27 October 1999 they informed Mr Ilkin that the clients had made application to the Ryde City Council to remove the trees and that such application was not to be seen as any admission of liability. Between 1 November 1999 and 24 November 1999 Messrs Levy Peatman wrote three letters to the Council inquiring as to what was happening in relation to the application.
· By this stage the first defendant had also made application to the Ryde City Council for the removal of the two trees on his property.
· Unfortunately although Ryde City Council had adopted a new tree preservation order and tree management policy on 24 August 1999 it did not notify any of the parties at that time that Council approval was no longer required for the removal of trees that were within three metres of a wall or foundation of a lawfully constructed building or if the tree posed an immediate danger to people or property.
7 On 24 November 1999 Messrs Levy Peatman wrote to the plaintiff’s solicitors in the following terms:
Ryde City Council have now granted approval for removal of the two trees on our clients’ Lot.
We have today written to our clients’ managing agents asking him to make immediate arrangements for the work to be carried out.
8 On 13 December 1999 Messrs Levy Peatman informed the plaintiff’s solicitors that Jackson Rowe had obtained quotations for the removal of the trees and were awaiting approval of the quotations by the Body Corporate (the fourth defendant).
9 On 22 December 1999 Mr Ilkin and Mr Levy had a conversation and although the exact terms of the conversation are not agreed it is clear that Mr Levy was asked whether he was instructed to accept service of any process. However, although Mr Levy indicated that he was so instructed, he did question Mr Ilkin about the efficacy of commencing any proceedings having regard to the fact that his clients were “on the point of removing the trees”.
10 Mr Levy was apparently left with the understanding that Mr Ilkin’s client was to commence proceedings, probably for an urgent injunction, apparently having regard to reports that had suggested an imminent danger to both property and persons should there be a wild storm in the near future. However Mr Levy was not sure whether such application would include his clients as he was of the view they were taking all reasonable steps to remove the trees.11 The plaintiff commenced proceedings by way of Summons filed on 20 January 2000 and served on the parties on about 23 January 2000. The Summons sought the following orders:
Litigation is Commenced
1) An order that the First and/or Second and/or Third and/or Fourth Defendants, their servants and agents, forthwith remove the trees.
2) Alternatively to the relief sought in 1 above, an order restraining the First and/or Second and/or Third and/or Fourth Defendants from allowing the roots of the trees to encroach on the Plaintiff’s land so as to cause a nuisance.
3) Damages as against the First and/or Second and/or Third and/or Fourth Defendants.
4) An order that the quia timet relief sought in paragraphs 1 and 2 above be granted on an expedited basis.
5) Further or other relief as the Court may deem(sic) appropriate.
6) Costs.
12 On 27 January 2000 Jackson Rowe informed Messrs Levy Peatman that they had employed Alpine Tree and Stump Service to remove the two gum trees on the second and third defendants’ property on 14 and 15 February 2000. They advised that a delay in the work being carried out had been experienced due to the recent Christmas break and the need to hire heavy duty equipment to carry out the work. It is conceded that the contents of this letter were not communicated to the plaintiff or the plaintiff’s solicitor at any stage prior to 4 February 2000.
13 The only communication between Messrs Levy Peatman and the plaintiff’s solicitor after the service of the Summons related to whether the second and third defendant agreed to the matter being expedited. As such agreement was forthcoming the plaintiff’s solicitor agreed that the matter would be mentioned by consent for the second and third defendants at the application for expedition.
14 The plaintiff’s solicitor had a conversation with the first defendant and his wife on 1 February 2000. The first defendant claimed that he informed the plaintiff’s solicitor on 31 January 2000 that the trees were going to be removed and that he had been waiting on the Council approval, which he had received only recently. He also claimed that he informed Mr Ilkin that he had referred the matters to his insurers. The conversation deposed to by Mr Ilkin includes a conversation with Mrs Starkey during which it is claimed Mrs Starkey said she did not want the trees pulled down as they had received some advice that there was no danger of them falling down.
15 When the Notice of Motion for expedition came before me on 4 February 2000, Mr Bradford of counsel appeared for the plaintiff and mentioned the matter on behalf of the second and third defendants. Ms Beardow, solicitor, appeared for the first defendant and Mr Russell, of counsel, appeared for the fourth defendant.
16 The first defendant indicated the trees on the Townhouse 21 property were to be removed on 21 February 2000 and the fourth defendant neither opposed nor consented to the removal. Notwithstanding all parties consent or lack of opposition to the matter being expedited I stood the matter over to 7 February 2000 to enable the second and third defendants’ position as to the removal of the trees to be ascertained.
17 On 7 February 2000 the second and third defendants counsel, Ms Pearman, informed the Court the trees on the Townhouse 20 property were to be removed on 14 and 15 February 2000. The Court noted that the first, second and third defendants had agreed with the plaintiff that they would remove the subject trees, insofar as those trees were situated on their land, not later than 22 February 2000. It was also noted that the fourth defendant agreed with the plaintiff that it would not do anything to prevent the first, second and third defendants from complying with their agreement to remove the subject trees by no later than 22 February 2000.
18 Each of the defendants has agreed to remove the trees without admission of liability for any damages claimed by the plaintiff. After this position was reached the plaintiff applied to have the proceedings transferred to the District Court of New South Wales. Each of the defendants consents to such transfer.
19 Notwithstanding the agreement to remove the trees and the consent to the transfer, Mr Bradford made an application that this Court should award the plaintiff costs of the proceedings to date prior to the transfer to the District Court. He submitted that:
1. The plaintiff should have its costs paid by each of the defendants to date; and
2. Such order should be made at this stage by this Court because the District Court would not be in a position to make an order to cover the costs incurred in the proceedings brought in the Supreme Court.
The defendants opposed the plaintiff’s application.
20 The application for costs was argued before me on 11 February 2000. Each of the parties filed affidavit evidence in support of their respective positions. None of the defendants argued that the plaintiff had improperly commenced the proceedings in this Court. Indeed, their previous willingness to have the matter expedited effectively endorsed the procedural steps taken by the plaintiff.
21 During the course of the argument on 11 February 2000 I expressed the view that it may be more appropriate to await the outcome of the proceedings before costs were awarded. Mr Bradford expressed concern that the District Court did not have power to make an order covering the costs prior to the transfer of the proceedings to the District Court. I granted leave to the parties to file written submissions on this aspect of the matter.
22 At the outset of the application Mr Bradford submitted that the plaintiff had commenced proceedings in this Court because it was advised the District Court may not have power to grant the injunctive relief sought. It was conceded that the balance of the proceedings could properly have been commenced in the District Court.
23 Mr Bradford submitted that, in respect of the first and fourth defendants, the plaintiff had been trying to achieve some action to rectify the problem for three years. He submitted that the agreement that was reached in Court on 7 February 2000 could have been reached a great deal earlier with far less cost to the plaintiff.
24 Although Mr Bradford recognised that the second and third defendants had only been involved in the dispute since last August, he submitted that it was still necessary for the plaintiff to commence the proceedings, particularly in the light of the advice that it had received that the situation was unsafe.
25 He submitted that the indication given to the plaintiff by Messrs Levy Peatman that arrangements were in train for the removal of the trees was not of much comfort as it was subject to the agreement of the fourth defendant and having regard to the history of the matter it could not be confident that agreement would be reached within a reasonable period.
26 The first defendant submitted that the plaintiff was informed that the trees were to be removed. This is a reference to a conversation after the Summons was served and in my opinion does not detract from the plaintiff’s submissions in relation to the necessity to commence the proceedings in order to precipitate some action in relation to a situation that on expert advice had become quite unsafe.
27 The fourth defendant submitted that it should not be held responsible for costs as it really had nothing, or very little, to do with the problem as the subject trees were on the properties of the other parties.
Application to transfer the proceedings to the District Court
28 This Court can transfer proceedings to the District Court pursuant to Section 143 of the District Court Act 1973, as amended, when it is of the opinion that the proceedings “could properly have been commenced as an action” in the District Court. An “action” in the District Court includes an “action of a kind which, if brought in the Supreme Court, would be assigned to the Common Law Division” and the amount claimed does not exceed $750,000. (Section 44(1)(a))
29 The plaintiff’s cause of action is in nuisance. Mr Bradford indicated that the damages claimed are presently assessed at about $100,000. The trees have now been removed and there is no claim for injunctive relief. All that is left for hearing is the claim for damages and as such it is a matter appropriate for the Common Law Division. If the jurisdictional limit were such as to justify its maintenance in this Court it would be appropriate to transfer it to that Division pursuant to section 54 of the Supreme Court Act 1970, as amended.
30 It is an action that “would be assigned” to the Common Law Division (s53 & Schedule 4 Part 8 Supreme Court Act; Part 12 Supreme Court Rules) and is therefore an “action” within the meaning of s44 of the District Court Act 1973, as amended, and is appropriate for transfer to the District Court pursuant to section 143 of that Act.31 When a matter is transferred to the District Court pursuant to s 143 of the District Court Act 1973 as amended, Part 5 r 13 of the District Court Rules applies to those proceedings. It provides as follows:
Power of the District Court to Award Costs
13(1) Where the Supreme Court makes an order under s 143 of the Act for the transfer of any proceedings to the Court sitting at a proclaimed place -
(a) a party, or a Registrar of the Supreme Court, shall lodge a copy of the order and a copy of the pleadings (if any) in the proceedings with the Registrar for that place;
(b) when the copy or copies, as the case may be, has or have been lodged under par (a), the proceedings shall -
i. cease to be proceedings in the Supreme Court;
ii become proceedings in the Court and be continued in the Court as if originally commenced in the Court at that proclaimed place on the day on which they were commenced in the Supreme Court; and
(c) any costs payable in respect of the order, copies of the order and pleadings (if any), and work done before the making of the order shall be allowed, subject to any order of the Supreme Court, as though the proceedings had remained in the Supreme Court.
32 Although Mr Bradford submitted otherwise, I am satisfied that the District Court has power to make an order for costs to cover the period prior to the transfer to the District Court.
33 The defendants filed supplementary written submissions after I reserved my judgment. It is argued for the first time in these submissions that the plaintiff should have commenced the proceedings in the District Court.
34 There are some nice arguments as to whether the injunctive relief sought by the plaintiff is truly ancillary to the main relief in the cause of action in nuisance ( s 44 and 46 District Court Act 1973; Pelechowski v Registrar, Court of Appeal (1999) 162 ALR 336) or whether or not it is a separate claim in equity within the jurisdiction conferred on the District Court in s 134 of the District Court Act 1973.
35 Although these are important matters I intend to regard them as unnecessary to decide having regard to the fact that at no stage was there any objection raised to the present proceedings being brought in this Court. The basis for this approach is in my view justified further by the effective endorsement of their commencement in this Court by the defendants’ consent or non opposition to an order for expedition. It was the Court’s further exploration of the position which resulted in rendering the orders for injunctive relief and expedition unnecessary.
36 The real issue for decision is whether an order for costs should be made at this time or await the outcome of the whole of the proceedings in the District Court.
37 The removal of the trees has been agreed to by each of the defendants without admission of any liability. I am of the view that unfairness may result from ordering a party who, without admission of liability agreed to remove the tress, to pay costs because they were slow to reach such agreement. It may be that the party who was the slowest to reach the agreement is found not to be liable to the plaintiff. These matters will not be known until the case is concluded.
38 I am of the view that an award of costs at this stage would be premature. I am of the opinion that it is appropriate to reserve the costs until the outcome of the questions of liability are decided or to such other appropriate time as a District Court Judge decides.39 1. Pursuant to section 143(1) of the District Court Act 1973, as amended, the proceedings are transferred to the District Court of New South Wales sitting at Sydney.
Orders
2. I reserve the question of costs up to the date of transfer of the proceedings to be decided by a Judge of the District Court pursuant to Part 5 Rule 13 of the District Court Rules.********************
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