Panton v The Owners of Survey Strata Plan 46838
[2013] WASC 35 (S)
•13 NOVEMBER 2013
PANTON -v- THE OWNERS OF SURVEY STRATA PLAN 46838 [2013] WASC 35 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2013] WASC 35 (S) | |
| Case No: | CIV:1142/2012 | 15 OCTOBER 2013 | |
| Coram: | PRITCHARD J | 13/11/13 | |
| 12 | Judgment Part: | 1 of 1 | |
| Result: | Each party to bear their own costs of the proceedings Plaintiffs' proposed modification permitted | ||
| B | |||
| PDF Version |
| Parties: | STEVEN JEREMY PANTON ROSALINDA PANTON THE OWNERS OF SURVEY STRATA PLAN 46838 |
Catchwords: | Exercise of the Court's discretion under s 129C(1)(c) of the Transfer of Land Act 1893 (WA) Principles in relation to an award of costs in an application under s 129C of the Transfer of Land Act 1893 (WA) |
Legislation: | Rules of the Supreme Court 1971 (WA) Supreme Court Act 1935 (WA) Transfer of Land Act 1893 (WA) Transfer of Land Act Amendment Act 1950 (WA) Transfer of Land Act Amendment Bill 1950 (WA) |
Case References: | Brown v State Transit Authority of New South Wales [2000] NSWSC 802 CMA Assets Pty Ltd v John Holland Pty Ltd (No 2) [2012] WASC 126 Field v Commissioner for Railways NSW [1957] HCA 92; (1957) 99 CLR 285 Mamfredas Investment Group Pty Ltd (formerly known as MAM Marketing Pty Ltd) v PropertyIT and Consulting Pty Ltd [2013] NSWSC 929 Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11 Re Rose Bay Bowling & Recreation Club Ltd (1935) 52 WN (NSW) 77 Re Withers [1970] VR 319 Rodgers v Rodgers [1964] HCA 25; (1964) 114 CLR 608 Shilkin v Taylor [2011] WASCA 255 Souter v Condor Developments [2012] WASCA 227 Stanhill Pty Ltd v Jackson [2005] VSC 355 Walker v Bridgewood (No 2) [2006] NSWSC 284 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- ROSALINDA PANTON
Plaintiffs
AND
THE OWNERS OF SURVEY STRATA PLAN 46838
Defendant
Catchwords:
Exercise of the Court's discretion under s 129C(1)(c) of the Transfer of Land Act 1893 (WA) - Principles in relation to an award of costs in an application under s 129C of the Transfer of Land Act 1893 (WA)
Legislation:
Rules of the Supreme Court 1971 (WA)
Supreme Court Act 1935 (WA)
Transfer of Land Act 1893 (WA)
Transfer of Land Act Amendment Act 1950 (WA)
Transfer of Land Act Amendment Bill 1950 (WA)
Result:
Each party to bear their own costs of the proceedings
Plaintiffs' proposed modification permitted
Category: B
Representation:
Counsel:
Plaintiffs : Ms C L Donald
Defendant : Mr M N Solomon
Solicitors:
Plaintiffs : Bennett & Co
Defendant : Hardy Bowen
Case(s) referred to in judgment(s):
Brown v State Transit Authority of New South Wales [2000] NSWSC 802
CMA Assets Pty Ltd v John Holland Pty Ltd (No 2) [2012] WASC 126
Field v Commissioner for Railways NSW [1957] HCA 92; (1957) 99 CLR 285
Mamfredas Investment Group Pty Ltd (formerly known as MAM Marketing Pty Ltd) v PropertyIT and Consulting Pty Ltd [2013] NSWSC 929
Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11
Re Rose Bay Bowling & Recreation Club Ltd (1935) 52 WN (NSW) 77
Re Withers [1970] VR 319
Rodgers v Rodgers [1964] HCA 25; (1964) 114 CLR 608
Shilkin v Taylor [2011] WASCA 255
Souter v Condor Developments [2012] WASCA 227
Stanhill Pty Ltd v Jackson [2005] VSC 355
Walker v Bridgewood (No 2) [2006] NSWSC 284
1 PRITCHARD J: I delivered reasons for decision in this matter on 11 February 2013,1 and these reasons should be read in conjunction with those. All abbreviations used in my earlier reasons are also used in these.
2 In my earlier reasons, I concluded that Mr and Mrs Panton had established that the Restrictive Covenant should be modified, pursuant to s 129C(1)(c) of the Transfer of Land Act 1893 (WA) (TLA), to permit certain improvements to be made to the Panton land (the permitted modifications). However, it was necessary for the parties to consider what orders should be made to give effect to those reasons. That required consideration of how the permitted modifications to the Restrictive Covenant should be expressed.
3 The lamentable state of the relations between the Marcheses and the Pantons is such that it has been necessary for the parties to formulate orders which contain a very precise specification of the permitted modifications within the area of the Panton land the subject of the Restrictive Covenant. Fortunately, following further mediation, the parties have been able to agree on most of those specifications. However, there are two issues which remain in dispute and require resolution before final orders can be made to dispose of this matter. These are:
(1) the height of a small portion of a retaining wall (the disputed portion) which will form part of the permitted modifications; and
(2) the appropriate orders in respect of the costs of these proceedings.
1. The height of the disputed portion of the retaining wall
4 The parties were content to have the dispute resolved on the basis of a plan of the proposed modifications, which was handed up at the hearing on 15 October 2013 (the plan), and on the basis of the submissions made by counsel at that hearing. There was no other evidence. The plan indicated the height of the retaining wall adjoining the disputed portion, in addition to all of the other proposed modifications.
5 The dispute in relation to the height of the disputed portion is a trivial one. The disputed portion is in an L-shape which surrounds part of a garden bed. Its dimensions appear to be approximately three metres by three metres. The subject of the dispute is whether the disputed portion should be built to a height of 22 courses, or 23 courses, of bricks. Some further perspective on the trivial nature of this dispute can be gleaned from the fact that the disputed portion constitutes one very small part of the total length of the retaining walls (comprising many, many metres of brickwork) which form part of the permitted modifications, by the fact that the retaining wall which adjoins the disputed portion will be built to a height of 23 courses on one end and 18 courses on the other end, by the fact that the disputed portion lies very close to the boundary fence between the Panton land and the Marchese land (and will be completely obscured, from the Marchese side, by that boundary fence), and by the fact that the Pantons propose to fill the garden beds retained by the retaining wall with plants, so that the height of the disputed portion of the retaining wall is unlikely to be visible to the Pantons.
6 The Pantons say that the disputed portion should be built to a height of 23 courses of bricks. Counsel for the Pantons submitted that building the disputed portion to this height would not offend the object of the Restrictive Covenant - the protection of the views from the Marchese land - and was preferable in order to properly retain the Panton land, given the steep slope of the block.
7 The Marcheses' concern is that the additional course of bricks in the disputed portion may make it easier to scale the boundary fence, the top of which would be 1.36 metres above the top of the disputed portion if that were built to 22 courses. There was no evidence about the dimensions of the bricks to be used in the construction of the retaining wall. However, assuming (solely for the purposes of illustration of the dimensions of the dispute) that the bricks are the dimensions of standard house bricks, then the top of the dividing fence would be about 1.28 metres above the top of the disputed portion if that were built to 23 courses.
8 Counsel for the parties submitted that I should resolve the dispute by assuming that the retaining wall is already permitted under the Restrictive Covenant, and consider whether construction of an additional course of bricks on the disputed portion would be a modification permitted by s 129C of the TLA. Adopting that analysis, I have concluded that in the exercise of the Court's discretion under s129C(1)(c) of the TLA, the Pantons should be permitted to modify the Restrictive Covenant so as to construct the disputed portion of the retaining wall to a height of 23 courses of bricks. In reaching that conclusion I have applied the principles I set out in my earlier reasons for decision at [85] - [90].
9 In my earlier reasons for decision, I found that the benefits enjoyed by the Marcheses as a result of the Restrictive Covenant included the visual benefit of overlooking an area of land with no built form. It appears that the disputed portion of the retaining wall will not be visible from the Marchese's land at all, or in the event that it is, it is very likely that it will be obscured by the plants grown in the garden beds retained by the retaining wall. None of the other benefits which I found were enjoyed by the Marcheses as a result of the Restrictive Covenant could be affected in any way by the construction of the disputed portion to 23 courses rather than 22 courses of bricks.
10 The basis for the Marcheses' submission that the disputed portion should be constructed to a height of 22 courses of bricks was that they would enjoy an additional benefit as a result of the Restrictive Covenant, namely a more secure property, because it would be more difficult to scale the boundary fence adjacent to the disputed portion if the disputed portion were 22 courses rather than 23 courses in height. There was no evidence in relation to that submission. In my view, the loss of the security 'benefit' from that very small height differential constitutes what may be described as a theoretical injury. In any event, even if it could be described as an injury which is not merely theoretical, I am satisfied that although the potential injury may be genuinely felt, it is, in the circumstances, insubstantial.
11 I am satisfied that construction of the disputed portion to a height of 23 courses of bricks would not substantially injure the Marcheses. There is nothing in this case which warrants a refusal to exercise the discretion under s 129C(1)(c) to permit this proposed modification. The permitted modifications may include construction of the disputed portion to a height of 23 courses of bricks.
2. The costs orders which should be made
12 The Pantons seek that there be no order made as to the costs of these proceedings. The Marcheses seek an order that the Pantons pay their costs, to be taxed if not agreed, up to and including 11 February 2013, without reference to any of the limits in any relevant costs determination. (The date of 11 February 2013 was the date on which I published my earlier reasons for decision.) The Marcheses do not seek any costs after that date. The parties are therefore in agreement that there be no order as to the costs incurred after 11 February 2013.
13 There remain two issues to resolve: what order should be made as to the costs prior to 11 February 2013, and in the event that the Pantons are required to pay the Marcheses' costs, whether the limits in relevant costs determinations should be lifted.
Principles in relation to an award of costs in an application under s 129C of the TLA
14 The starting point in considering an award of costs in relation to an application to modify a restrictive covenant under s 129C of the TLA is s 129C(8) which provides that:
The costs of and incidental to an application made pursuant to the provisions of this section to the court or a judge shall not be awarded against the defendant or respondent in any event.
15 Counsel for the Marcheses submitted that, in the exercise of its discretion to award costs, the Court should be guided by principles which have developed in New South Wales and Victoria in relation to an award of costs for an application to extinguish or modify restrictive covenants and easements.2 He submitted that those principles include the following: costs orders should not be made against a defendant; unless the defendant's unsuccessful objection to a modification is frivolous, that defendant may nevertheless be entitled to costs; if the application to modify is wholly successful (or perhaps substantially so) the appropriate order is that there be no order as to costs; and if the plaintiff has been only partially successful, the defendant ought be entitled to its costs of the proceedings. Counsel for the Marcheses acknowledged that the first of these principles reflected the statutory position in Western Australia.
16 There have not been any cases in which the principles that have developed in other jurisdictions have been used to guide this Court in relation to an award of costs in proceedings brought pursuant to s 129C of the TLA.
17 For the reasons set out below, I am not persuaded that the principles developed elsewhere, in relation to legislation which does not contain an equivalent to s 129C(8) of the TLA should be applied here. The preferable approach to costs in relation to these matters is to exercise the Court's general discretion in relation to the award of costs - pursuant to s 37 of the Supreme Court Act 1935 (WA) and O 66 of the Rules of the Supreme Court 1971 (WA) (RSC) - but with one important qualification, namely that in s 129C(8) of the TLA. The terms of s 129C(8) reflect a deliberate decision by the Parliament of this State that regardless of the outcome of an application under s 129C, the defendant should not be ordered to pay the plaintiff's costs. The policy behind that decision undoubtedly reflects the fact that an application under s 129C is made for the purpose of extinguishing, discharging or modifying a proprietary right vested in the defendant, and the defendant should not be ordered to bear the costs of another party's application to interfere with his or her proprietary rights. However, subject to s 129C(8), the retention of the Court's wide discretion as to costs enables it to do justice in all of the different manifestations of cases under s 129C. That policy position can be discerned from the debate in relation to s 129C when it was introduced into the TLA in 1950.3
18 The Transfer of Land Act Amendment Bill 1950(WA) (the Bill), in the form in which it was introduced into the Legislative Assembly in 1950, contained a proposed s 129C(8) in the following terms:
The costs of and incidental to an application made pursuant to the provisions of this section to the court or a Judge shall be awarded against the applicant in any event.
19 Concerns were expressed about the proposed s 129C, and an amendment was moved,4 and passed,5 in the Assembly which resulted in the whole of proposed s 129C being removed from the Bill.
20 When the Bill was debated in the Legislative Council, the Minister for Transport moved an amendment to again include the whole of the proposed s 129C in the Bill, including proposed s 129C(8) in the terms set out above. However, in the course of the debate, an amendment to that proposed subsection was moved and carried, so that the terms of s 129C(8) which passed the Council were the terms in which that subsection presently appears in the Act. The Bill, containing s 129C(8) in that amended form, was then returned to, and passed by, the Legislative Assembly.
21 In the course of the debate in the Legislative Council, the Minister for Transport said this,6 with a view to the inclusion in the Bill of s 129C(8) in its original form:
It can be argued that if a person desires to be freed of a restriction which limits his use of land, he should be prepared to pay the costs of a judicial inquiry, and that any person who has the benefit of the restriction should be permitted to go to the court without incurring expense to put forward his viewpoint. In other words, the person asking the court to reverse an existing state of affairs, should be prepared to pay all costs of the application, including the costs of any interested party who opposes the application, whether such opposition is on reasonable grounds or not.
The opposite argument would be that the discretion of the court to award costs should not be interfered with. Persons desirous of utilising the provisions of the section might be precluded from approaching the court or compelled to withdraw their applications if they are placed in the position of having to pay the costs of objectors, who might be encouraged to bring forward objections which are without merit. I trust that this explanation of the proposed clause will make the position clear to the House and that members will accept the Bill as submitted.
22 In moving his amendment to the proposed s 129C(8), Mr H S W Parker said this:
The effect of my proposed amendment on the amendment is that the judge can say to an applicant, if he has made an application which is palpably wrong and unfair, and it is defended, 'I cannot grant your application and you will pay the costs of the defendant.' But the judge will not be able to say, if my amendment is carried, that the defendant shall, under any circumstances, have to pay the applicant’s costs. That is to say, if the applicant has a very good case and the defendant wrongly puts him to a lot of expense by defending the action, even then the judge cannot say to the defendant that he must pay the applicant’s costs as he would under normal conditions.7
23 Having heard this view, the Minister for Transport said that he was
inclined to accept Mr Parker's explanation. … I think the effect would be substantially the same. I accept his assurance that the subsection, as he proposes to amend it, contains certain safeguards, and I will not oppose his amendment.8
24 In my view, there can be discerned from the debate a Parliamentary intention that a defendant to an application under s 129C should not be required to bear the costs of that application. However, the Parliament was also concerned that an applicant should not necessarily be required to bear the defendant’s costs of resisting an application, but that the Court should have a discretion to make costs orders appropriate to the particular circumstances of a case, subject to the protection afforded to a defendant under s129C(8).
The parties' submissions as to considerations relevant to the award of costs in this case
25 Counsel for the Pantons submitted that the Pantons should not be ordered to pay any of the Marcheses' costs because prior to the commencement of the litigation, the Marcheses had unreasonably resisted negotiations as to any modification of the Restrictive Covenant and required the plaintiffs to bring proceedings, that that resisting conduct was between neighbours, and that I had concluded that the modification of the Restrictive Covenant was reasonable. I am unable to accept this submission, for two reasons. First, the Pantons led evidence relevant to this submission at the trial. That evidence was the subject of an objection by counsel for the Marcheses on the basis that it encompassed 'without prejudice' communications. To that extent that evidence is clearly inadmissible.9 Secondly, I do not accept that the Marcheses' refusal to consent to the proposed modifications could be considered unreasonable behaviour which would disentitle them from any order for costs in their favour, particularly in view of my conclusion that the Restrictive Covenant prohibited the proposed modifications which were the subject of dispute at the trial,10 and in view of my conclusion that the Restrictive Covenant should not be modified so as to permit some of the major items in the proposed modifications, such as the pool and decking.
26 Counsel for the Pantons submitted that they were substantially successful in these proceedings, because their application to modify the Restrictive Covenant was granted. Accordingly, having regard to s 129C(8) of the TLA, counsel for the Pantons submitted that the appropriate costs order which should be made was either that there be no order as to costs, or that the parties should bear their own costs of the proceedings.
27 Counsel for the Marcheses submitted that the case involved two issues: whether the Pantons' proposed modifications were prohibited by the Restrictive Covenant, and if so, whether the Restrictive Covenant ought to be modified to permit the proposed modifications. He submitted that the Pantons were wholly unsuccessful in respect of the first issue and only modestly successful on the second issue. In those circumstances, he submitted that the appropriate costs order was that the Pantons pay the Marcheses' costs of the proceedings.
The order for costs which should be made
28 After very careful consideration of all of the submissions of counsel, I have reached the conclusion that the appropriate order in this case is that the parties should bear their own costs, for the reasons which follow.
29 I start with the proposition that the Court's discretion to award costs is very wide, but must be exercised judicially.11 The general rule is that a successful party is entitled to an order for costs: O 66 r 1(1) RSC. In the present case, the Pantons were successful, in that their application for the modification of the Restrictive Covenant was successful.
30 However, they were not wholly successful in the sense that I determined that the Restrictive Covenant should not be modified to permit all of the proposed improvements sought by the Pantons, such as the pool and the decking. On the other hand, the Marcheses objected to the proposed modification in respect of almost all of the other improvements sought by the Pantons, save for the driveway and the urn. Even in so far as they were prepared not to object to the construction of a driveway, that concession was confined to a driveway constructed to certain specifications. I was prepared to conclude that the Restrictive Covenant should be modified to permit the driveway proposed by the Pantons.
31 Where a party who is generally successful has failed on some issue or issues which increased the costs of the action, the Court may order that party to pay the costs of those issues: O 66 r 1(3) RSC. However, as the Court of Appeal recently observed12:
… that is a power to be exercised with caution and not as a matter of course. While parties should be encouraged to litigate only those matters which are properly and reasonably in issue, parties should not be dissuaded by the risks of an adverse costs order from canvassing all issues which might be material to the proper determination of a case: Keet v Ward. Moreover, any practice of determining costs on the basis of a painstaking analysis of which party won on which issue would simply add to the time, costs and uncertainty of litigation: see Bowen v Alsanto Nominees Pty Ltd. Such an approach may also fail to do justice in cases where the issues were intertwined or overlapped, or there was only one substantive issue. The exercise of the power to adjust an order for costs by reference to particular issues upon which an otherwise successful party has failed will ordinarily be appropriate only where the party has failed on discrete and severable issues which have added to the costs of the action in a significant and readily discernible way: Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell.
32 These observations are, with respect, entirely apt in the present case. I am not persuaded by the submission made by counsel for the Marcheses that the issues in the present case can be neatly divided into the construction of the Restrictive Covenant, and the modification arguments. Construing the meaning of a restrictive covenant will very often (save if there is consent as to its measuring) be a necessary first step in determining whether an application for the modification of a restrictive covenant should be permitted. In addition, there was a considerable overlap in the evidence relevant to the question whether the proposed improvements were prohibited by the Restrictive Covenant, and whether the Restrictive Covenant should be modified to permit those proposed improvements.
33 To the extent that the Pantons were unsuccessful in seeking the modification of the Restrictive Covenant with respect to some improvements, I am not persuaded that this is a case where an apportionment should be made on the basis that they failed on discrete and severable issues which added to the costs of the action in a significant and readily discernible way. The improvements sought by the Pantons were inter-related. For example, I accepted that the Restrictive Covenant on its face did not preclude the construction of a fence or fences of any kind (including, necessarily, a pool fence), yet I found that the Restrictive Covenant should not be modified to permit a pool to be constructed. The evidence adduced by the parties pertained to the proposed improvements as a whole, and individual witnesses were not called to give evidence with respect to individual improvements. Furthermore, I do not think it is possible to attempt any quantitative or qualitative assessment of the extent to which the Pantons were successful, so as to apportion costs from that perspective either.
34 This was a hard fought battle in which neither party achieved the totality of what they wanted. In all of the circumstances, and having regard to s 129C(8) of the TLA, the appropriate order to do justice between the parties is that each party should bear their own costs.
35 In view of this conclusion, it is unnecessary to consider the question whether the limits of relevant costs determinations should be lifted.
36 Counsel for the parties should submit a minute of orders, preferably by consent, which includes both orders which reflect these reasons for decision and orders (the subject of agreement between the parties) which give effect to my earlier reasons for decision.
1Panton v The Owners of Survey Strata Plan 46838 [2013] WASC 35.
2Re Rose Bay Bowling & Recreation Club Ltd (1935) 52 WN (NSW) 77; Re Withers [1970] VR 319; Stanhill Pty Ltd v Jackson [2005] VSC 355; Brown v State Transit Authority of New South Wales [2000] NSWSC 802; Walker v Bridgewood (No 2) [2006] NSWSC 284; Mamfredas Investment GroupPty Ltd (formerly known as MAM Marketing Pty Ltd) v PropertyIT and Consulting Pty Ltd [2013] NSWSC 929.
3 Section 129C(8) was introduced into the Transfer of Land Act 1893 (WA) by the Transfer of Land Act Amendment Act 1950 (WA) s 34.
4 Western Australia, Parliamentary Debates, Legislative Assembly, 21 September 1950, 896 (Mr F J S Wise).
5 Western Australia, Parliamentary Debates, Legislative Assembly, 21 September 1950, 897.
6 Western Australia, Parliamentary Debates, Legislative Assembly, 25 October 1950, 1417 (Mr C H Simpson, Minister for Transport).
7 Western Australia, Parliamentary Debates, Legislative Assembly, 25 October 1950, 1419 (Mr H S W Parker).
8 Western Australia, Parliamentary Debates, Legislative Assembly, 25 October 1950, 1419 (Mr C H Simpson, Minister for Transport).
9Rodgers v Rodgers [1964] HCA 25; (1964) 114 CLR 608, 614 (McTiernan, Taylor & Owen JJ); Field v Commissioner for Railways NSW [1957] HCA 92; (1957) 99 CLR 285, 291 - 292 (Dixon CJ, Webb, Taylor & Kitto JJ); Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11 [91 - [95] (McLure J); Shilkin v Taylor [2011] WASCA 255 [61] (Newnes JA), [1] (Pullin JA agreeing), [2] (Buss JA agreeing); CMA Assets Pty Ltd v John Holland Pty Ltd (No 2) [2012] WASC 126 [15] - [16] (Allanson J).
10 Subject to one exception, namely in respect of the underground water tanks in respect of which the evidence did not permit any conclusion to be reached.
11Souter v Condor Developments Pty Ltd [2012] WASCA 227 [27] (Newnes JA), [1] (Buss JA agreeing), [48] (Murphy JA agreeing).
12Souter v Condor Developments [2012] WASCA 227 [28] (Newnes JA), [1] (Buss JA agreeing), [48] (Murphy JA agreeing).
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