Pancho Properties Pty Limited v Wingecarribee Shire Council

[2004] NSWLEC 620

Land and Environment Court

of New South Wales

CITATION:	Pancho Properties Pty Limited v Wingecarribee Shire Council [2004] NSWLEC 620
PARTIES:	APPLICANT Pancho Properties Pty Limited RESPONDENT Wingecarribee Shire Council
FILE NUMBER(S):	10071C of 1998; 10072A of 1998; 10138 of 1999
CORAM:	Talbot J
KEY ISSUES:	Costs :- matter determined in class 1 on issue whether jurisdictional fact established - takes on character of ordinary litigation for costs purposes.
LEGISLATION CITED:	Land and Environment Court Rules, Part 16, Rule 4(2) Wingecarribee Local Environmental Plan 1989 cl 13(4), cl 23
CASES CITED:	Broadwater Action Group Inc v Richmond Valley Council and Another (No.2) (2003) 129 LGERA 401 ; Gee v Port Stephens Council (2003) 131 LGERA 325; Gibson v Mosman Municipal Council (2001) 116 LGERA 397 ; Nahum v North Sydney Municipal Council (1984) 83 LGERA 200
DATES OF HEARING:	28/10/04
DATE OF JUDGMENT:	11/09/2004
LEGAL REPRESENTATIVES:	APPLICANT Mr I J Hemmings (Barrister) SOLICITORS Gadens Lawyers RESPONDENT Mr B J Preston SC with Mr N C T Bilinsky (Barrister) SOLICITORS B. Bilinsky & Co

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Talbot J

9 November 2004

10071C of 1998; 10072A of 1998; 10138 of 1999 Pancho Properties Pty Limited v Wingecarribee Shire Council

JUDGMENT

1 Talbot J: In each of the matters No. 10071C of 1998, No. 10072A of 1998 and No. 10138 of 1999 the respondent, Wingecarribee Shire Council (“the Council”) is seeking an order for costs in its favour.

2 The nature of each of the proceedings has been fully explained in earlier judgments by this Court and the Court of Appeal. It is not necessary to further labour through the history in order to determine the present application by the Council, for an order for costs in its favour, in respect of the final determination made by me on 22 April 2004.

3 Both the Council and the applicant claim that they were successful in matter No. 10072A of 1998, after I modified the terms of Condition 3 of a Development Consent granted by the Council in accordance with cl 23 of Wingecarribee Local Environmental Plan 1989 (“LEP 1989”).

4 Notwithstanding that the primary argument by the applicant and the initial purpose of the appeal in 10072A of 1998 was for the deletion of Condition 3, Mr Hemmings nevertheless contends that the Court ultimately replaced Condition 3 with a slightly reorganised version of the condition that was proffered by the applicant. That is partly true.

5 The Council unsuccessfully argued that there was no power to grant development consent following the lodgement of the appeal and that it was not intended for a new dwelling house to wholly replace an existing dwelling, as required by cl 23 of the LEP. The Council also argued that as the proposed development was inconsistent with the objectives of the zone, development consent could not be granted.

6 It is apparent therefore that both parties failed in their primary submission.

7 Prior to the coming into force of Part 16, Rule 4(2) of the Land and Environment Court Rules, the Chief Judge made it clear after a careful analysis of earlier decisions pursuant to paragraphs 10 and 10A of the Land and Environment Court Practice Direction 1993 that “where a council chooses to put in issue the capacity for approval either by raising a preliminary question of law or…a preliminary question involving matters of both fact and law, the usual approach to costs in class 1 appeals is inappropriate” and as the matters so raised are matters appropriate for ordinary litigation the usual order should be that costs follow the event. (Gee v Port Stephens Council (2003) 131 LGERA 325 at [60]).

8 Part 16, Rule 4(2) now provides:-

No order for the payment of costs will be made in proceedings to which this Rule applies unless the Court considers that the making of a costs order is, in the circumstances of the particular case, fair and reasonable.

9 Strictly speaking matter No. 10072A of 1998 was not determined on the merits of the application. The issue of whether development consent could be maintained at all and if it was, whether Condition 3 could be deleted, were resolved contrary to the argument of the Council and the applicant respectively. Neither party can be regarded as being entirely successful. The development consent was granted and Condition 3 was maintained, albeit, in a modified form.

10 In my opinion it is fair and reasonable that there be no order for the payment for costs in matter No. 10072A of 1998.

11 In matter No. 10071C of 1998 the finding of the Court, compendiously stated, is that the applicant was unable to establish the necessary jurisdictional facts to enable the Court to exercise power to grant consent pursuant to cl 13(4) of the LEP.

12 Again in matter No. 10138 of 1999 the Court found that the use of an original cottage as a rural workers dwelling was prohibited in the circumstances by the application of cl 23 of the LEP and Condition 3 of the existing development consent. Prima facie therefore, these proceedings also took on the character of conventional litigation.

13 In Broadwater Action Group Inc v Richmond Valley Council and Anor(No.2) (2003) 129 LGERA 401 at [9] Lloyd J made obiter remarks which suggest that, notwithstanding the careful analysis by the Chief Judge in Gee he would not follow it. However His Honour did not have to decide the matter because in the application before him, in contrast to Gee, there was only a determination of questions purely of fact. Considering that the Chief Judge adopted the reasoning of Stein J and myself in Nahum v North Sydney Municipal Council (1984) 83 LGERA 200 and Gibson vMosman Municipal Council (2001) 116 LGERA 397 respectively, I propose to follow the approach taken by the Chief Judge, McClellan CJ.

14 I regard the judgment in matter No. 10071C of 1998 and No. 10138 of 1999 as being determined on at least mixed questions of fact and law which had the effect that there was no power to grant development consent in either case. Accordingly they both had the character of ordinary litigation and that is certainly how the parties treated it. The issues were complex and required a close examination of the findings of the Court of Appeal and construction of the provisions of the LEP.

15 Mr Hemmings seeks to avoid the consequences of a costs order against his client. He argues that having regard to the history of the matter, on the basis that at the time the proceedings were commenced, the conventional approach was for costs to be awarded in exceptional circumstances in class 1 proceedings. In addition Mr Hemmings argues that the applicant has already suffered a costs burden as a consequence of the application of those principles by having to pay its own costs of interlocutory proceedings, notwithstanding its success in persuading the Court to dismiss notices of motion by the Council. Furthermore Mr Hemmings argues that no order should be made for costs against his client as a consequence of the way in which the Council has conducted the proceedings, thereby adding to the complexity of the issues.

16 The Council is not seeking costs of the proceedings that took place prior to the determination by the Court of Appeal nor of the hearing in the Court of Appeal itself. The present application is confined to the joint hearing of the three matters that took place subsequent to the judgment of the Court of Appeal on 8 November 2001.

17 The gravamen of argument by Mr Hemmings is that the actions of Council in raising a series of interlocutory challenges, by way of notices of motion, prior to the commencement of the final hearing and the failure to comply with directions amounts to disentitling conduct. I have not been persuaded that this is correct to the extent that the Council should be deprived of its costs. I have already averted to the complex nature of the issues. There was indeed a battle of tactics all of which can be rightly regarded as part of the overall litigation process. The fact that certain issues were not raised until after the Court of Appeal handed down its decision does not mitigate against a costs order. The Council has never conceded at any stage that the applicant was entitled to the further consents that it was seeking in order to maintain the existence of the original cottage. The issues ultimately decided against the applicant were fundamental and jurisdictional. They were essential issues that had to be resolved before the Court could proceed to determine either application on its merits. The applicant failed in all respects.

18 On a proper construction of Part 16, Rule 4(2) it is only where the Court concludes that it would not be fair and reasonable to make a costs order that there be no order for the payment of costs in class 1 proceedings. The Court has decided that the making of a costs order is, in the circumstances of this particular case, fair and reasonable. The question of whether there be no order for the payment of costs does not arise.

19 Any attempt to distinguish a case where points are decided in a preliminary way from a determination made after a full hearing is not reasonable in the circumstances where all issues were resolved by an adjudication on the permissibility of the proposed development that led to the judgment on 22 April 2004. It became appropriate to deal with all outstanding issues once and for all and that was done. However as the applicant could not demonstrate that it had an entitlement for its development applications to be considered in matter No 10071C of 1998 and No. 10138 of 1999 the question of a merits hearing did not arise and accordingly the principles enunciated by McClellan CJ in Gee apply and costs should follow the event.

20 It is appropriate therefore that there be no order as to costs in matter No. 10072A of 1998 and it is fair and reasonable that the applicant pay the Council’s costs in matter No. 10071C of 1998 and No. 10138 of 1999. The applicant’s success in relation to the costs issue in matter No. 10072A of 1998 is not such that the Council should be deprived of its costs in respect of the notice motion seeking an order for costs, so that the applicant will be ordered to pay the Council’s costs in relation to the hearing on 28 October 2004.

21 The formal orders of the Court are:-

1. In matter No. 10072A of 1998 no order as to costs after 8 November 2001.

2. That the applicant Pancho Properties Pty Limited pay the costs of the respondent, Wingecarribee Shire Council in matter No. 10071C of 1998 and No. 10138 of 1999 after 8 November 2001.

3. The applicant, Pancho Properties Pty Limited pay the costs of the respondent Wingecarribee Shire Council in respect of the application for costs heard on 28 October 2004.