Owners - Strata Plan No 20530 v Eady Eady v North Sydney Council

[2004] NSWLEC 244

Land and Environment Court

of New South Wales

CITATION:	Owners - Strata Plan No 20530 v Eady Eady v North Sydney Council [2004] NSWLEC 244
PARTIES:	Owners-Strata Plan No 20530 (Appl in class 4) Arthur Eady (Resp in class 4 and appl in class 1) North Sydney Council (Resp in class 1)
FILE NUMBER(S):	40206/04; 10442/03 of
CORAM:	McClellan CJ
KEY ISSUES:	Development Application :- Class 1 proceedings Industrial Strata building Appeal of council's refusal of a development application of one owner in the building Owners' corporation's concern that application involved some common property Consent of owner Dismissal of proceedings DEVELOPMENT APPLICATION: Class 4 proceedings Owners' corporation's role in development application Whether lack of owners' corporation's consent to the application prevents the court upholding an appeal in relation to council's refusal of a development application Dismissal of proceedings COSTS: In class 1 Special circumstances Lack of legal foundation of development application Fair and reasonable basis for awarding costs COSTS: In class 4 Indemnity costs Party party costs
LEGISLATION CITED:
CASES CITED:
DATES OF HEARING:	1 April 2004
EX TEMPORE JUDGMENT DATE :	04/01/2004
LEGAL REPRESENTATIVES:	J Luchetti (Sol - appl in class 4) Luchetti & Co (Sol - appl in class 4) V A Bizannes (Sol - resp in class 4) Bizannes & Associates (Sol - resp in class 4) R Fife (Resp Council in Class 1 proceedings) Mallesons Stephen Jaques (Resp Council in class 1 proceedings)

JUDGMENT:

IN THE LAND AND

ENVIRONMENT COURT

OF NEW SOUTH WALES

40206/04
10442/03

McCLELLAN J

THURSDAY 1 APRIL 2004

OWNERS STRATA PLAN NO 20530 v EADY

EADY v NORTH SYDNEY COUNCIL

Judgment

Introduction

1 HIS HONOUR: In this matter there are two proceedings before me this morning. The first is a class 1 appeal brought by Mr Eady where he seeks approval for an application, which he lodged with North Sydney Council, to make alterations to premises which are a two-storey industrial building in North Sydney. Mr Eady is the owner of lots 1 and 2 in the premises, which I understand are physically the ground floor and the first floor of the building.

2 The law requires a development application to be accompanied by the consent of the owner. The building is subject to strata title and, some time ago, the owners' corporation became concerned that the application lodged by Mr Eady with the Council, as ultimately prepared, included some of the common property. The position of the strata body was that without its consent, the Council could not accept and consider the development application lodged by Mr Eady.

3 The matter became one of contest and Mr Eady did not, at least until recently, accept the argument which the owners' corporation was making. The development application before the Council was refused and, accordingly, the class 1 proceedings to which I have referred were commenced in this Court. Those proceedings have been mentioned on a number of occasions but have not come to a hearing.

4 In the meantime, the owners' corporation commenced class 4 proceedings. The orders sought in those proceedings are not entirely appropriate, but the substantive issue is plain. The owners' corporation wish to assert that the development application, which founded the class 1 appeal, was not supported by the owners' consent and accordingly could not have been approved by the Council and, furthermore, could not be approved by the Court in the class 1 proceedings.

5 The parties to the class 4 proceedings have now reached agreement as to what should occur subject to matters of costs. That agreement involves Mr Eady consenting to the class 1 appeal being dismissed with the consequence that the class 4 proceedings will also be dismissed.

6 The owners' corporation seeks an order for its costs on an indemnity basis in the class 4 proceedings and the Council seeks an order for its costs in the class 1 proceedings. Mr Eady concedes that the application, which was lodged with the Council, was not accompanied by the necessary consent of the owner. The owners' corporation asserts that there was dishonesty involved in the process but I am in no position to determine whether that submission has any foundation and, accordingly, the matter of costs should be dealt with upon the assumption that the claim made by the owners' corporation that the application lacked the necessary consent is good, but without consideration of whether or not there was dishonest conduct by any party.

7 In that event, as far as the class 4 proceedings are concerned, the normal rules apply and costs would follow the event. Mr Eady having conceded an entitlement in the owners' corporation to relief, the owners' corporation is entitled to an order for its costs. However, having regard to the basis upon which the matter has been resolved, I do not believe it is appropriate for me to contemplate making an order for those costs on an indemnity basis.

8 Accordingly, with the knowledge that the class 1 proceedings are to be dismissed, I note the agreement of the parties in relation to the class 4 proceedings and I make an order that the class 4 proceedings be dismissed and I order the respondent, Mr Eady, to pay the owners' corporation's costs of those proceedings on a party party basis.

9 With respect to the class 1 proceedings, as I have indicated, although the matter has been mentioned on a number of occasions, those proceedings have not been brought to a hearing. The concession in the class 4 proceedings that the owners' consent was not provided with the application has the consequence that the application which was placed before the Council, and which was the subject of the class 1 appeal, was never put on the appropriate legal foundation.

10 Accordingly, to the extent that the Council has been put to expense in defending that appeal, those moneys have been entirely wasted. The merits of the matter have not and will not be considered because the application itself was fundamentally flawed.

11 The rules of the Court in class 1 proceedings now provide that in the normal course an order for costs will not be made. The foundation for that rule is to ensure that parties are not discouraged by the possibility of having to pay another party's costs from approaching the court to have the merits of a particular application reviewed.

12 However, the rule provides that an order may be made where the court is satisfied that it is fair and reasonable, in the circumstances of the case, that costs be ordered. In the present case, as I have indicated, the merits of the application have not been tested before the Court because the application was fundamentally flawed. In those circumstances, the moneys expended by the Council have been entirely wasted, and in my opinion, it is both fair and reasonable that the applicant, Mr Eady, in those proceedings be ordered to pay the Council's costs.

13 Accordingly, I note that in the class 1 proceedings the parties are agreed that the application should be dismissed. I order that the application in the class 1 proceedings be dismissed and I order the applicant, Mr Eady, to pay the respondent Council's costs of the class 1 proceedings.

**********