Parabanks Shopping Centre Pty Ltd v City of Salisbury (No 2)
[2013] SASC 204
SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
PARABANKS SHOPPING CENTRE PTY LTD v CITY OF SALISBURY & ANOR (NO 2)
[2013] SASC 204
Judgment of The Honourable Justice Blue
23 December 2013
PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - POWERS OF COURT
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - OTHER CASES - SUBSTANTIAL SUCCESS
On 8 November 2013, certiorari was granted at the instance of the plaintiff to quash the first development plan consent granted by the first defendant on the application of the second defendant but relief was refused in relation to a second application for development plan consent.
Each party seeks an order for costs in its favour.
Held:
1. There were two separate events: the plaintiff was successful on the first and the defendants were successful on the second (at [12]-[15]).
2. The time devoted to and costs incurred in respect of each event were approximately the same (at [21]).
3. Although there were two defendants who incurred two sets of costs, they had a community of interest (at [24]).
4. In all of the circumstances, there should be no order as to costs (at [25]-[26].
Supreme Court Act 1935 (SA) s 40; Supreme Court Civil Rules 2006 (SA) r 263(1), referred to.
Advance Resources Services Pty Ltd v Charlton [2008] SASC 118; (2008) 100 SASR 388; Australian Trade Commission v Disktravel [2000] FCA 62; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Copping v ANZ McCaughan Ltd (1996) 63 SASR 523; GPT re Ltd v Woolongong City Council [2006] NSWLEC 658; (2006) 151 LGERA 174; McGovern v Ku-Ring-Gai Council [2008] NSWCA 209; (2008) 72 NSWLR 504; Milne v Attorney-General for the State of Tasmania (1956) 95 CLR 460; Robinson v Australian Association of Social Workers Ltd [200] SASC 239; (2000) 210 LSJS 73, considered.
PARABANKS SHOPPING CENTRE PTY LTD v CITY OF SALISBURY & ANOR (NO 2)
[2013] SASC 204Civil Application for Judicial Review
BLUE J. This is an application for costs in an action for judicial review. The plaintiff, Parabanks Shopping Centre Pty Ltd (“Parabanks”), sought orders quashing two development plan consents granted by the first defendant, the City of Salisbury, upon applications by the second defendant, 83 Saints Road Nominees Pty Ltd (“Saints”).
On 8 November 2013, I delivered reasons for judgment in which I concluded that the first development plan consent should be quashed but that the second consent should not.[1]
[1] [2013] SASC 168.
Parabanks seeks an order for costs in its favour on the basis that it was successful in obtaining relief in relation to the first development plan consent (albeit it failed on the second development plan consent) and most of the time at trial and pre‑trial was devoted to the first development plan consent.
The Council and Saints seek an order for costs in their favour on the basis that Parabanks failed in its overall challenge to development approval (albeit it succeeded in respect of the first development plan consent) and most of the time at trial and pre‑trial was devoted to issues upon which Parabanks failed.
Relevant principles
Costs are at the discretion of the Court under section 40 of the Supreme Court Act 1935 (SA). The discretion is unfettered, but must be exercised judicially.[2]
[2] Copping v ANZ McCaughan Ltd (1995) 63 SASR 523 at 527-528 per King CJ (Mohr and Nyland JJ agreeing).
As a general rule, costs follow the event.[3] The general rule applies to a wholly successful party.[4] Where there are two events with different results, the position is complex.
[3] Supreme Court Civil Rules 2006 (SA) r 263(1); Copping v ANZ McCaughan Ltd (1995) 63 SASR 523 at 527-528 per King CJ (Mohr and Nyland JJ agreeing); Advance Resources Services Pty Ltd v Charlton [2008] SASC 118; (2008) 100 SASR 388 at [10] per Doyle CJ and [52] per Bleby J.
[4] See the mode of expression of the High Court in Milne v Attorney‑General for the State of Tasmania (1956) 95 CLR 460 at 477 per Dixon CJ, McTiernan, Williams, Fullagher and Taylor JJ.
Where there is a single event, but the overall successful party has failed on one or more issues, the question arises whether costs should be apportioned according to issues. The question of apportionment involves an assessment of all relevant circumstances, including:
1.the degree to which the issues on which the successful party failed were distinct and severable;
2. the proportion of costs incurred in respect of the issues on which the successful party failed;
3. the strength or merit of the issues on which the successful party failed; and
4. the conduct generally of the successful party.[5]
[5] See Australian Trade Commission v Disktravel [2000] FCA 62 at [3] per French, Kiefel and Mansfield JJ; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [3]-[6] per Finkelstein and Gordon JJ.
Where there is a single event and an apportionment of costs according to issues, the successful party might be deprived of costs in respect of issues upon which it was unsuccessful but not necessarily pay the costs of its opponent in respect of those issues. One circumstance in which such a party might be ordered to pay the costs of its opponent on issues upon which the successful party lost is where that party’s conduct in relation to those issues was unreasonable, such as when it was unreasonable to pursue those issues.[6]
[6] Robinson v Australian Association of Social Workers Ltd [2000] SASC 239; (2000) 210 LSJS 73 at [16]-[20] per Martin J (Prior and Williams JJ agreeing).
Preliminary contentions
Parabanks seeks a complex order for costs, namely that the defendants pay its costs until 21 May 2013, its costs of making disclosure, 75 per cent of its costs of preparing the three volumes of tender books, and party-party costs of 50 percent of its trial costs. The rationale for such an order is that costs incurred until 21 May 2013 related exclusively to the first development plan consent, Parabanks’ disclosure related exclusively to the first consent and the case books related predominantly (approximately 75 per cent) to the first development plan consent. I reject that approach. It is overly precise, artificial and does not represent an assessment of the parties’ overall success on the events of and issues in the action.
Saints contends that Parabanks should be deprived of and pay costs because of its unreasonable misconduct before the institution of the action. Saints identifies the misconduct as Parabanks failing to inform the Council of its grounds for a belief that the gross leasable area of relevant shops exceeded 5,500 square metres in response to the Council’s invitation on 23 July 2012. I reject that contention. While Parabanks might be criticised for failing to respond, it had no obligation to do so and in the circumstances its failure to respond did not constitute misconduct of the type which should result in an adverse costs order against a party. In any event, when the action was instituted, the defendants elected to defend the first development plan consent notwithstanding that they were now aware of the grounds upon which Parabanks contended that the cap of 5,500 square metres was exceeded.
Who won the war?
In GPT Re Ltd v Woollongong City Council,[7] Biscoe J adopted a useful analogy from military campaigns. He said:
GPT won the war but lost all battles bar one. Should it be awarded all its costs of the war, or part of its costs of the war reflecting the costs of the only battle it won? Should it pay its opponent’s costs of the battles it lost?
It is one thing to deprive a successful applicant of the costs of severable issues on which it is failed, it is another thing to order it to pay the other party’s costs of those issues. Cases such as Mok, and Belongil indicate that the latter order may be made where the raising of an issue by the applicant was so unreasonable that it is fair and just to do so. Unreasonable conduct by an applicant procedurally or in the conduct of its case may, I think, also have that result.
There is no suggestion of such conduct in the present case, except for a suggestion by Belmorgan that the abandoned issues should be presumed to have been unreasonably advanced since they were abandoned. I would not make that presumption....
...
In the present case, in my opinion, there are no circumstances which make it fair and just to order GPT to pay Belmorgan’s costs of the issues on which GPT was unsuccessful.
However, in my opinion, GPT should only have its costs of the delegation issue, on which it succeeded. It should not have its costs of the issues on which it failed which are severable.[8]
[7] [2006] NSWLEC 658; (2006) 151 LGERA 174.
[8] (2006) 151 LGERA 174 at [15]-[17] and [19]-[20].
In the present case, there were two separate wars which overlapped in time. Parabanks brought the action initially challenging the first development plan consent: costs incurred in the action until it was amended to encompass the second development plan consent were incurred in respect of the original development plan consent. After the Council granted the second development plan consent, Parabanks could have brought a separate action; instead, it adopted the procedurally sensible device of amending the action to encompass the second development plan consent. There were two separate events. Parabanks won the first war. The defendants won the second war.
I reject the defendants’ contention that there was a single war being the question whether the development could proceed. The defendants elected to defend both development plan consents and thereby defined the battle ground. The defendants could have chosen to defend only the second development plan consent. Their election to defend the first development plan consent resulted in costs being incurred in relation to that event. While Saints indicated that it would not rely upon the first development plan consent if the validity of the second development plan consent were upheld, it nevertheless elected to defend both consents.
I reject Parabanks’ contention that there was a single war being any challenge to development plan consent. Parabanks elected to challenge the second development plan consent knowing that Saints had altered the plans in response to Parabanks’ contentions concerning the gross leasable area of relevant shops exceeding 5500 square meters. Parabanks was unsuccessful in its challenge to the second development consent.
In the particular circumstances of this case, the appropriate course is to adopt a broad brush approach by considering the major issues upon which substantial time was devoted at trial, broadly assign major and minor issues to the first or second development plan consent, notionally award costs in respect of the first development plan consent to Parabanks and the second development plan consent to the defendants, assess the approximate time devoted respectively to the two sets of issues and then make an order based upon a broad axe approach.
Assessment of major issues
The major issues which I assign to the first development plan consent were:
1.whether the receiving area shown in the original plans should be included in the calculation of gross leasable area;
2.whether the pad site should be included in the calculation of gross leasable area; and
3.whether there was a valid permission granted by the Council, in response to a valid application, to vary the application to remove the pad site.
The major issues which I assign to the second development plan consent were:
1.whether the areas designated “shared receiving area” and “common plant room” should be included in the calculation of gross leasable area;
2.whether tenancies shown as “personal services”, “restaurants” or “bulky goods outlet” should be included in the calculation of gross leasable area; and
3.whether the application was invalid because it was hypothetical.
There were a number of minor issues raised in respect of the first development application which I notionally assign to the first event in favour of Parabanks as follows:
1.whether the grant of development plan consent by Mr Taylor was invalid because the application had already been determined by Mr Sproule;
2.whether discretion should be exercised against granting relief;
3.whether the Council was obliged to make further enquiries concerning the receiving area and pad site before making relevant decisions;
4.whether the entire area of buildings containing relevant shops should be counted in the calculation of the gross leasable area.
Parabanks should notionally recover its costs in respect of those minor issues. They occupied less time at trial compared to the major issues identified above and splitting costs according to the result of those issues is not justified in the overall exercise of my discretion. Parabanks succeeded on the first two minor issues and the third did not arise because Parabanks succeeded in its primary case. Although Parabanks failed on the fourth minor issue, almost no time was devoted to it at trial.
I notionally assign in favour of the defendants the minor issue involving the lifts and stairs upon which they were unsuccessful in respect of the second development plan consent for analogous reasons. In addition, I notionally assign to the defendants all of the time devoted to the issues whether tenancies shown as “personal services”, “restaurants” or “bulky goods outlet” should be included in the calculations, whether the Council should have made further enquiries in relation to those types of tenancies and whether the application was hypothetical, regardless of whether the time was devoted to the first or second development plan consent. This is because those issues necessarily arose in respect of the second development plan consent upon which the defendants were successful.
Allocation
My assessment is that the time spent at trial and pre‑trial on the issues which I have assigned to the first development plan consent (in favour of Parabanks) was broadly equal to the time spent at trial and pre‑trial on the issues which I have assigned to the second development plan consent (in favour of the defendants). In the exercise of a broad axe discretion, the appropriate order is that each party should bear its own costs of action.
The position of the Council
The Council and Saints were both properly joined as defendants to the action. The Council contends that, if costs are to be awarded against Parabanks, costs should be awarded in favour of each of the Council and Saints without reduction on account of the fact that both defendants had a common interest. In this respect, the Council points particularly to the contentions by Parabanks concerning the validity of the Council’s delegations, the necessity for the Council to seek further information and that the development was hypothetical. Saints makes a similar contention.
In McGovern v Ku‑Ring‑Gai Council,[9] the McGoverns brought proceedings seeking that the Council’s grant of a development application made by Mrs Allan was invalid. The defendants were successful at first instance and on appeal. The New South Wales Court of Appeal held that the McGoverns should effectively pay only one set of costs for the Council and the developer and apportioned those costs such that the Court orders that the McGoverns pay 75 per cent of the developer’s costs and 25 per cent of the Council’s costs. Unlike the present case, the McGoverns were wholly unsuccessful in the litigation. Basten JA (Spigelman CJ and Campbell JA agreeing) said:
There is a separate issue, however, as to whether the appellants should pay the costs of both respondents in the Land and Environment Court (and in this Court). There is no doubt that both parties were properly joined in the proceedings; however, they had a community of interest on the primary point, which was maintaining the validity of the second consent. As noted above, comments in the joint judgment in Oshlack raise a question as to whether it is appropriate for the Council to be an active opponent of proceedings, where it is the consent authority and may need to reconsider a decision under challenge. A possible result is that, if it plays an inappropriate role, even on the successful side of the record, it may not obtain its costs of the proceedings. However, this was not a usual case. The major part of the challenge mounted by the appellants was to the conduct of two councillors and at least one Council officer. ... this was a case in which it was appropriate for the Council to take an active role in defence of its councillors and officers.
...
Nevertheless, because the Council had a legitimate role to play, does not mean that it should necessarily receive its costs, or all of them. Despite Mr Allan’s assertions to the contrary in his emails, it was the proponent of the development who had the real interest in maintaining the validity of the consent and not the consent authority.
In the circumstances of the case, there has been no demonstration that, to the extent that the respondents had differing interests, those interests were in conflict. Accordingly, although they could not be compelled to employ the same legal representatives, the costs payable by the appellants should not exceed the amount which would have been payable had that happened. What that figure might be is largely speculative, without knowing the extent to which responsibility for the conduct of the proceedings may in a practical sense have been divided between the respondents. The appropriate course is to require that the appellants pay 75 per cent of the costs of the proponent of the development (the second respondent) and 25 per cent of the costs of the Council.[10]
[9] [2008] NSWCA 209; (2008) 72 NSWLR 504.
[10] Ibid at [226] and [228]-[229].
In the present case, there was a commonality of interest between the defendants on all issues. This was reflected in the fact that they made very similar submissions on each issue. I accept that it might have been appropriate for the Council to make its own submissions on the delegation issue because that related to the internal affairs of the Council and perhaps in relation to the allegation that it had a duty to make enquiries. However, the Council chose to make submissions on all issues (albeit it tended to supplement the submissions already made by Saints) and Saints made submissions on all issues. There was no division of responsibility between the two defendants.
In addition, I have concluded that, on an overall assessment, this is not a case in which Parabanks should be ordered to pay costs. In all of the circumstances, it is not appropriate to order that Parabanks pay a component of the Council’s costs or a component of Saints’ costs.
Conclusion
I make no order as to the costs of the action.
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