Perry Properties Pty Limited v Georges River Council (No 2)

Case •

[2023] NSWLEC 64

•

19 June 2023

No judgment structure available for this case.

Land and Environment Court


New South Wales

Medium Neutral Citation: Perry Properties Pty Limited v Georges River Council (No 2) [2023] NSWLEC 64
Hearing dates: Written submissions filed 24 May 2023, 2 June 2023, 6 June 2023
Date of orders: 19 June 2023
Decision date: 19 June 2023
Jurisdiction:Class 4
Before: Pritchard J
Decision:

The Court makes the following orders:

(1) The first, second, third, fourth, fifth and sixth applicants are to pay the first respondent’s costs in the proceeding Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51, as agreed or assessed.

(2) Each of the parties to pay their own costs in relation to the preparation of submissions on the question of costs.

Catchwords:

COSTS – whether costs should follow the event – allegation of disentitling conduct – model litigant obligations of Council – whether ordinary litigation – whether costs for loss attributable to disturbance under Land Acquisition (Just Terms Compensation) Act 1991 (NSW) apply to Class 4 proceedings

Legislation Cited:

Civil Procedure Act 2005 (NSW) s 98

Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ss 14, 55, 59(1)(a)

Land and Environment Court Rules 2007 (NSW) r 4.2

Local Government Act 1993 (NSW)

Uniform Civil Procedure Rules 2005 (NSW) r 42.1

Cases Cited:

AHB v New South Wales Trustee and Guardian [2014] NSWCA 216

Al Amanah College Inc v Minister of Education and Training (No 2) [2011] NSWLEC 254

Australian Securities and Investments Commission v Rich [2009] NSWSC 1229; (2009) 236 FLR 1

Banno v Commonwealth of Australia (1993) 45 FCR 32; (1993) 81 LGERA 34

Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [2010] NSWLEC 59; (2010) 173 LGERA 280

Caruana v Port Macquarie-Hastings Council [2007] NSWLEC 109; (2007) 210 LGERA 1

Hastings Point Progress Association v Tweed Shire Council (No 3) [2010] NSWCA 39; (2010) 172 LGERA 157

Hoy v Coffs Harbour City Council [2016] NSWCA 257; (2016) 281 LGERA

Inner West Council v Sheree Waks [2018] NSWLEC 41

Jeray v Blue Mountains City Council [2011] NSWLEC 135

Latoudis v Casey (1990) 170 CLR 534; [1990] HCA 59

Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537

Oshlack v Richmond River Council [1998] 193 CLR 72; [1998] HCA 11

Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51

Roads and Maritime Services v Desane Properties Pty Ltd (2018) 98 NSWLR 820; [2018] NSWCA 196

Scott v Handley [1999] FCA 404; (1999) 58 ALD 373

Texts Cited:

NSW Premier’s Memorandum M2016-03 Model Litigant Policy for Civil Litigation

Category:Costs
Parties: Perry Properties Pty Ltd (First Applicant)
Vince Perry (Second Applicant)
Maria Perry (Third Applicant)
Anthony Perry (Fourth Applicant)
Rosina Perry (Fifth Applicant)
Joanna Perry (Sixth Applicant)
Georges River Council (First Respondent)
The Minister for Local Government (Second Respondent)
National Australia Bank (Third Respondent)
International Buddhist Association of Australia Co-operative Limited (Fourth Respondent)
Representation:

Counsel:
A Pearman and A Gauja (First, Second, Third, Fourth, Fifth and Sixth Applicants)
J McKelvey (First Respondent)
Submitting appearance (Second Respondent)
Submitting appearance (Third Respondent)
Submitting appearance (Fourth Respondent)

Solicitors:
Weinberger Lawyers (First, Second, Third, Fourth, Fifth and Sixth Applicants)
HWL Ebsworth Lawyers (First Respondent)
Crown Solicitor’s Office (Second Respondent)
Dentons (Third Respondent)
Marsdens Law Group (Fourth Respondent)
File Number(s): 2022/289534
Publication restriction: Nil

JUDGMENT

Introduction

  1. In Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51 (substantive judgment), I determined on 11 May 2023 that the applicants’ further amended summons filed 8 May 2023 be dismissed.

  2. I also directed the parties to provide written submissions, no longer than five pages in length, on the question of costs.

Outcome

  1. I have determined that costs should follow the event, and that the applicants pay the costs of the first respondent, Georges River Council (Council). However, each of the parties is to pay their own costs in relation to the preparation of submissions on the question of costs.

Factual background and procedural history

  1. The substantive judgment concerned proposed acquisition notices given by Council to the first to sixth applicants in relation to land known as 247 Princes Highway, Carlton, being the whole of Lot 1 in Deposited Plan 301901, Parish of St George, County of Cumberland (the property). The factual background and procedural history are set out in the substantive judgment, [1] and I do not reproduce that background and history here.

    1. At [1]-[11], [21]-[65].

  2. In the substantive judgment, I found that the applicants did not discharge their onus of establishing any of the grounds sought in the further amended summons. [2] In particular, Ground 1 of the further amended summons concerned whether Council sought to acquire the property for an authorised purpose. [3] In relation to that ground, my findings included that:

    2. Substantive judgment at [158].

    3. Substantive judgment at [14(1)].

  1. I was not satisfied “on the basis of the scant evidence relied upon by the applicants” that Council was acquiring the property for the purpose of resale; [4]

    4. Substantive judgment at [81].

  2. the applicants did not establish that any use of the property as a licensed venue would be contrary to its classification as community land under the Local Government Act 1993 (NSW) (LGA). Rather, the applicants assumed that leasing the property for the purpose of a licensed venue would be contrary to the statutory restrictions placed on community land. However, that would not be the case if an appropriate plan of management were in place; [5]

  3. there was “nothing, persuasive, in the evidence” that suggested Council’s substantial purpose of acquisition of the property was for anything other than for the lawful purpose of public recreation; [6]

  4. the applicants sought to controvert the clear documentary record which established the pursuit of the acquisition for an authorised purpose, and that Ground 1 reduced to “unsupported assertion and speculation”; [7]

  5. there was “no reliable evidence” to suggest that Council proposed to use the property as a licensed venue or saleable development or any other purpose inconsistent with its zoning and proposed classification as community land; [8] and

  6. it was “close to impossible to draw any inference” from the documents relied upon by the applicants, being documents obtained from consultants and not adopted by Council, to go behind, and supplant, a resolution made by Council. [9]

    5. Substantive judgment at [92].

    6. Substantive judgment at [110].

    7. Substantive judgment at [114].

    8. Substantive judgment at [115].

    9. Substantive judgment at [120].

  1. Central to the parties’ submissions on the question of costs was the contention advanced by the applicants concerning Council’s “disentitling conduct”, particularly having regard to Council’s failure to respond to a letter sent by Mr Nathan Weinberger, solicitor for the applicants, on 16 February 2023 querying Council’s purpose of the acquisition of the property. [10] That question was tied to Ground 1 of the applicants’ further amended summons.

    10. Substantive judgment at [65].

Statutory framework

  1. Section 98(1) of the Civil Procedure Act 2005 (NSW) (CPA) provides that, subject to rules of court and to the CPA or any other Act, costs are in the discretion of the court, and the court has full power to determine by whom, to whom and to what extent costs are to be paid. It also provides that the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.

  2. Notwithstanding the Court’s broad discretion, r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) provides the general rule that “costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs”. The person seeking to displace that presumption must show that there is something out of the ordinary in the case in order to justify the departure. [11]

    11. Hastings Point Progress Association v Tweed Shire Council (No 3) [2010] NSWCA 39; (2010) 172 LGERA 157 at [18] (Young JA, McColl JA agreeing).

  3. Circumstances which may justify the displacement of the presumption include where the successful party has engaged in “disentitling conduct”. In Oshlack v Richmond River Council, [12] McHugh J referred to examples of disentitling conduct, which include where the successful party by its lax conduct effectively invited the litigation, or unnecessarily protracted the proceedings.

    12. [1998] 193 CLR 72; [1998] HCA 11 at [69] (McHugh J) citing Anglo-Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [1951] 1 All ER 873 at 874.

  4. It is well accepted that an award of costs is not to punish the unsuccessful party, but is compensatory. [13] The rationale of such an order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred. [14]

    13. Latoudis v Casey (1990) 170 CLR 534; [1990] HCA 59 (Latoudis v Casey) at 543 (Mason CJ), 563 (Toohey J), 567 (McHugh J).

    14. Latoudis v Casey at 566-7 (McHugh J).

Disentitling conduct on the part of Council?

  1. Council’s position was that costs should follow the event in accordance with r 42.1 of the UCPR as the applicants were wholly unsuccessful in their application. Council submitted that as the applicants raised allegations of misconduct by Council in its dealings with the Minister for Local Government (the Minister) and the administration of its meeting on 28 February 2022, [15] it was necessary and appropriate for Council to be the active party in the proceedings. It submitted that there had been no disentitling conduct by Council such as to suggest that no award of costs could be justified in the circumstances.

    15. See substantive judgment at [6], [122]-[132].

  2. Central to the applicants’ allegation of disentitling conduct on the part of Council was that on 16 February 2023, Mr Weinberger sent a letter to Ms Jane Hewitt and Ms Sarah Wilson of HWL Ebsworth Lawyers, solicitors for Council. In that letter, Mr Weinberger said:

19. …our clients have had to commence these proceedings to protect their respective property rights, inter alia, in circumstances where Council has not been forthcoming with information about what the premises are to be used for. Details, which suggest an improper purpose, have had to have been elicited through preliminary discovery measures and subpoenas, at significant costs to our clients.

20. As you are aware, this matter is now entering into a phase where both parties are likely to incur substantial costs in preparing for the hearing.

21. It seems to us that this matter could have been resolved many months ago if Council simply answered the following question: Is Council going to use the Premises, after acquisition, as a pub, restaurant or a licensed café? Is it going to be part of a hotel and/or serviced apartments? If not, what precisely is the Premises intended to be used for?

22. For example, if Council had simply stated with substantiating evidence at the outset, that the Premises were intended, at the time of the proposed acquisition notice, to be used as a museum, for example, then that would have disposed of the matter on the basis that is not an improper purpose. Costs would not have been incurred.

23. We invite the Council to give serious consideration to answering the questions at paragraph 21 of our letter...

  1. On the same day, the solicitors for Council responded stating that they would seek instructions. On 23 February 2023, Mr Weinberger followed up on the letter of 16 February 2023, and on 24 February 2023, the solicitors for Council replied: “[w]e anticipate being in a position to respond following filing of Council’s evidence in chief.” On 9 March 2023, Mr Weinberger again followed up on the letter of 16 February 2023. Council’s solicitors did not respond to Mr Weinberger.

  2. The applicants submitted that Council’s failure to respond to the applicants’ letter of 16 February 2023 amounts to disentitling conduct. Had Council chosen to respond by providing further information about what the property was going to be used for, or simply confirmed that they would not be part of a hotel and/or serviced apartments, the applicants submitted that they “would not have pursued the matter further by way of litigation.”

  3. Further, the applicants submitted that the following matters were relevant to what they submitted was Council’s disentitling conduct:

  1. Council’s failure to respond to Mr Weinberger’s letter of 25 February 2022 and the text messages from Mr Perry, the second applicant, of the same date; [16]

  2. Council’s refusal on 29 June 2022 to provide Mr Perry with its application to the Minister which, [17] in the applicants’ submission, contained “important details” about the proposed acquisition; and

  3. Council’s failure to respond to a request by Mr Weinberger on behalf of Mr Perry for those same documents.

    16. See substantive judgment at [49]-[50].

    17. See substantive judgment at [45]-[46], [56]-[60].

  1. The applicants submitted that “[r]equesting further information about the purposes of the proposed acquisition was a reasonable request” having regard to the remarks of the Court of Appeal in Roads and Maritime Services v Desane Properties Pty Ltd at [276],[18] where Bathurst CJ, Ward and Payne JJA said:

276. …In Municipal Council ofSydney v Campbell [1925] AC 338 and Campbell v Municipal Council of Sydney (1923) 24 SR (NSW) 179, at 209 it was held that a landowner needed the means to be satisfied that the public purpose was a permitted purpose. As we have said, the relevant scheme here contains its own mechanisms to ensure relevant information is exchanged between the landowner and the acquiring authority…

18. (2018) 98 NSWLR 820; [2018] NSWCA 196.

  1. The applicants submitted that Council’s failure to respond to Mr Weinberger’s letter of 16 February 2023 meant that they did not have the means to be satisfied that the public purpose of the proposed acquisition was a permitted purpose. The applicants said they had a reasonable basis to ask the questions they asked based on the evidence identified in the substantive judgment, [19] which provided, in the applicants’ submission, a basis for reasonable suspicion. The applicants submitted that: “Council’s answers, if provided, would have resolved the proceedings”; and that: “Council’s failure to respond amounts to disentitling conduct.”

    19. Substantive judgment at [38], [39], [49]-[53], [73], [78].

  2. In relation to the question of disentitling conduct, Council submitted that as no plan of management in accordance with Division 2 of the LGA has been prepared, in draft or otherwise, in relation to the property, the ultimate, particular use of the property remains unknown to Council. It has not at any relevant time been able to answer the question raised in Mr Weinberger’s letter of 16 February 2023, beyond stating that the property was being acquired for recreation purposes and would be classified as community land. Council submitted that this should have been apparent to the applicants since prior to the commencement of the proceedings, but in any event, the solicitors for Council identified this fact to the applicants in a letter dated 17 November 2022, which stated that:

…no draft plan of management has been prepared for the Premises setting out its categorisation within its classification as 'community land'. Accordingly, it is as yet unknown which of the core objectives set out in ss 36E through 36N of the Local Government Act 1993 will apply to the Premises.

  1. The applicants, in reply, submitted that the mere fact that a plan of management had not been prepared does not amount to a substantive response to their question concerning the public purpose of the acquisition. They submitted that “an appropriate plan of management is a relevant factor in determining the ultimate permissiveness of a particular purpose”, referring to [92] of the substantive judgment. Without any idea of what that plan of management might provide, it was submitted, it was very difficult for a landowner to be able to be satisfied as to the permissiveness of the public purpose. In these circumstances, a request for clarity as to the ultimate and/or particular use of the property – or what the property was “not to be used for” – was justified.

  2. Council also submitted that there was no evidence from any of the applicants that would lead the Court to find that if any of them had been provided with further information or confirmation that the land proposed to be acquired would not be part of a hotel/serviced apartments, they would not have pursued the matter further.

  3. Again, in reply, the applicants submitted that Mr Weinberger’s letter of 16 February 2023, including references to “substantial costs in preparing for the proceedings” and “the potential to avoid further costs in this matter” was clear evidence that the applicants were amenable to resolving the matter prior to hearing, and that they would not have pursued the matter further had they received a response to the letter.

Council’s obligations as a model litigant?

  1. The applicants submitted that Council’s conduct in failing to respond to Mr Weinberger’s letter of 16 February 2023 also amounted to a breach of the Model Litigant Policy for Civil Litigation set out in the NSW Premier’s Memorandum M2016-03 (Model Litigant Policy), which requires that the State or its agencies act honestly and fairly in handling litigation including by endeavouring to avoid litigation where possible and, if that is not possible, by attempting to keep the costs of litigation to a minimum.

  2. The applicants submitted that Council is subject to a higher standard than the duty of fairness owed to the Court by civil litigants generally, relying on the decision of Austin J in Australian Securities and Investments Commission v Rich at [524] in the context of the Commonwealth and its agencies. [20] There his Honour said:

524. On the authority of Scott v Handley, it seems to me that, in its submissions in this case, ASIC has understated its duty of fairness in civil proceedings. It has a higher duty than the duty owed by every civil litigant to the court to act fairly and appropriately. The Commonwealth and its agencies, including ASIC, are held to a standard of fair dealing which is higher than the standard applicable to other litigants. Whether the duty is owed to the court or to the other party to the litigation, the other party can complain to the court at the hearing about non-compliance with the duty… 

The applicants did not refer to any authority directly relating to local councils in NSW and the Model Litigant Policy.

20. [2009] NSWSC 1229; (2009) 236 FLR 1 (Austin J).

  1. The Model Litigant Policy does not refer to local councils. However, I accept that the preponderance of authority suggests that councils constituted under the LGA in discharging their public functions are subject to obligations to act as a model litigant, and responsibilities which go beyond that of private litigants. [21]

    21. Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537 at 558-9 (Mahoney JA); Scott v Handley [1999] FCA 404; (1999) 58 ALD 373 at [43]-[44] (Spender, Finn and Weinberg JJ); Jeray v Blue Mountains City Council [2011] NSWLEC 135 at [39] (Craig J); Inner West Council v Sheree Waks [2018] NSWLEC 41 at [80] (Robson J).

  2. In relation to compulsory acquisitions, the applicants submitted that the NSW Government has adopted policies, including a July 2019 document annexed to the applicants’ submissions titled, “Minimum requirements: Minimum negotiation period of acquisition of land” (the Minimum Requirements document) which sets out to “provide direction” in relation to the acquisition of land under the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (Just Terms Act). The applicants submitted that the Minimum Requirements document applied to Council, and sets out to ensure, amongst other things, “transparency during the negotiation period” and “procedural fairness to property owners” (at cl 1.1). Further, the Minimum Requirements document also refers (at cl 3.3, page 10) to the Model Litigant Policy. Accordingly, it was submitted that landowners can reasonably expect that an acquiring authority will comply with the Model Litigant Policy in the context of acquisitions, particularly where there is a “clear power imbalance of information”.

  1. The applicants submitted that a failure to comply with the Model Litigant Policy justifies a departure from the general rule that costs follow the event, relying on the Court of Appeal’s decision in AHB v New South Wales Trustee and Guardian (AHB). [22] In that case, Meagher JA (McColl and Basten JJA agreeing) held that the failure of the respondent, as part of the executive government and subject to the Model Litigant Policy, to endeavour to avoid litigation and to keep the costs of litigation to a minimum, justified a departure from the ordinary rule that costs follow the event. [23]

    22. [2014] NSWCA 216.

    23. AHB at [46]-[47].

  2. Council submitted that the applicants incorrectly conflated the Model Litigant Policy with the requirements of the Minimum Requirements document.

  3. Council submitted that its election not to respond to Mr Weinberger’s letter of 16 February 2023 cannot be characterised as a breach of the Model Litigant Policy in circumstances where:

  1. no specific answer to the key question raised by the applicants beyond what had already been communicated could be provided in any event;

  2. its evidence in chief was required to be filed by 27 February 2023; and

  3. the litigation involved voluminous correspondence from the applicants, as well as subpoenas and notices to produce issued by the applicants, which all required attendance.

  1. Further, Council submitted that AHB involved a failure to communicate where there had been a significant change to the circumstances in which the challenged decision had been made. Accordingly, the decision was not applicable here.

Whether the proceeding was “ordinary litigation”?

  1. The applicants further relied on the comments of Wilcox J in Banno v Commonwealth of Australia (Banno) [24] at 51, albeit made in the context of proceedings for compensation. There his Honour said:

The Court has a general discretion as to costs, but the discretion must be exercised on principled grounds. The Commonwealth has succeeded on all issues. It would therefore seem difficult to justify ordering it to pay the applicants' costs. Moreover, if this was ordinary litigation, the Commonwealth might reasonably expect to obtain an order that the applicants pay its costs. But this is not ordinary litigation. The relationship between the parties giving rise to the litigation did not arise out of their mutual desire; it arose because of a unilateral decision of the Commonwealth to acquire the applicants' land in order to satisfy a perceived public need. The acquisition left the applicants in the position of either accepting the Commonwealth's assessment of the proper compensation or of having the Court rule on its adequacy.

24. (1993) 45 FCR 32; (1993) 81 LGERA 34.

  1. The applicants submitted that in this case, although not dealing with compensation issues, they were in an analogous position. The proceeding arose, they submitted, because of the unilateral decision of Council to acquire their land and/or interests. The acquisition, they submitted, “left them in the position of simply accepting Council’s assertions of a proper public purpose, in circumstances where they had reasonable suspicions to doubt Council’s assertions, and their requests for further information were ignored.” The only other option available to the applicants, they submitted, was to have the Court rule on the propriety of that purpose.

  2. Council submitted that there was nothing out of the ordinary to justify a departure from the usual costs order. It submitted that the Court’s finding in respect of the applicants’ reliance on “scant” evidence, [25] leading to the conclusion that Ground 1 was “unsupported assertion and speculation”, [26] was sufficient to warrant a costs order.

    25. Substantive judgment at [81], [89], [94].

    26. Substantive judgment at [114].

  3. Further, Council submitted that the comments of Wilcox J in Banno were made in the context of a compensation claim not comparable to the subject case and, in any event, were obiter comments which led to no order. Further, in light of the findings in the substantive judgment, [27] the Court would conclude that the applicants’ case was not arguable.

    27. Substantive judgment at [81], [89], [94], [114].

Proceeding in the public interest?

  1. Council also submitted that an alternative costs order would not be made pursuant to r 4.2 of the Land and Environment Court Rules 2007 (NSW) (LEC Rules) on the basis that the proceeding was brought in the public interest. Council relied on the three-step approach set out by Biscoe J in Kennedy v Minister for Planning (NSW) (Kennedy) [28] at [5] in determining whether to depart from the usual costs rule and make no order as to costs under the public interest provision in r 4.2(1) of the LEC Rules:

5. A three step approach has been developed to determine whether to depart from the usual costs rule and make no order as to costs under the public interest provision in r 4.2(1). First, can the litigation be characterised as having been brought in the public interest? Secondly, if so, is there something more than the mere characterisation of the litigation as being brought in the public interest? Thirdly, are there any countervailing circumstances, including in relation to the conduct of the applicant which speaks against departure from the usual costs rule?

28. [2010] NSWLEC 269.

  1. In submitting that this litigation was “clearly not brought in the public interest”, Council relied on the three-step approach in Kennedy and the considerations set out by Preston CJ in applying that three-step approach in Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 3) [29] at [13]-[61]. There, his Honour said at [60] (citations omitted):

    29. [2010] NSWLEC 59; (2010) 173 LGERA 280.

60. Even where courts have found or assumed that the litigation could be characterised as public interest litigation, they may decline to depart from the usual costs rule because of countervailing considerations. Some of these can be seen to be the converse of the public interest considerations earlier referred to, but others are independent. Countervailing considerations identified in the cases include:

(a) the applicant is seeking to vindicate rights of a commercial character and stands to benefit from the litigation;

(b) where the applicant is an incorporated association, the private interests of members of the association would be affected, legally or financially, by the outcome of the litigation…or the group is a “façade” or vehicle for persons wishing to protect their own commercial interests;

(c) the applicant is supported financially by persons or bodies who would benefit from, or would have their legal or financial interests affected by, the outcome of the litigation;

(d) the narrowness of the question of public interest raised, such as only involving a discrete point of interpretation without broad ramifications;

(e) the applicant “unreasonably pursues or persists with points which have no merit” or issues that were not “eminently arguable”…; and

(f) there is disentitling conduct of the applicant, such as impropriety or unreasonableness in the conduct of the litigation.

  1. Council submitted that the applicants were simply seeking to protect their own private property and financial interests and directly stood to benefit from the litigation had their summons been successful. It submitted that the Court’s findings about the quality of the applicants’ evidence would be a further countervailing circumstance that would lead the Court to conclude, even if the proceeding could conceivably be considered to have been brought in the public interest, that the ordinary rule of costs following the event ought apply.

Applicability of ss 55 and 59(1)(a) of the Just Terms Act?

  1. In the alternative, the applicants relied on ss 55 and 59(1)(a) of the Just Terms Act. Those provisions provide for compensation for any loss attributable to disturbance, which means, inter alia, “legal costs reasonably incurred by the persons entitled to compensation in connection with the compulsory acquisition of the land”. [30]

    30. Just Terms Act s 59(1)(a).

  2. The applicants submitted that there is no temporal limit in the Just Terms Act, and that the words “in connection with” are of “wide scope”, relying on the decision of Biscoe J in Caruana v Port Macquarie-Hastings Council. [31] There his Honour said at [44]:

44. The words “in connection with” have been held to have a “wide scope”: State Bank of NSW v Blacktown City Council (NSWLEC 30 September 1994 unreported). Waddell AJ allowed the cost of obtaining advice from senior counsel prior to the lodgement of the claim for compensation under s 59(a) of the Just Terms Act. Pre-acquisition legal and valuation costs were allowed under s 59(a) and (b) in Overton Investments Pty Ltd v Minister Administering the Environmental Planning and Assessment Act (NSWLEC unreported 24 December 1998 Sheahan J). After considering State Bank (his Honour said at [19] that it was a decision under s 59(f) but in fact it was under s 59(a) and (b)) and the cases of Fitzgerald, Stephenson and King referred to below, his Honour concluded that the broad principles that emerged from those cases was that: a claim for disturbance is an equitable claim, the validity of which depends on the particular circumstances of each case; there is no general rule that the costs incurred must follow in time the acquisition; there must, however, be some sort of a causal connection between the costs claimed and the acquisition; and that connection must not be too remote (an appeal on other grounds was dismissed: (2001) 113 LGERA 439).

31. [2007] NSWLEC 109; (2007) 210 LGERA 1.

  1. The applicants also relied on Hoy v Coffs Harbour City Council,[32] where Bathurst CJ (Simpson and Payne JJA agreeing) said at [60]:

60. … Section 59(1)(a), in my opinion, is directed to compensating persons for legal costs incurred in respect of an acquisition, whether resulting from the application of the hardship provisions or the action of the acquiring authority. It does not confer an entitlement to compensation for costs which arise prior to that time.

32. [2016] NSWCA 257; (2016) 281 LGERA 411.

  1. The applicants submitted that a person is entitled to compensation once the authority becomes bound to acquire the land which, having regard to s 14 of the Just Terms Act, arose after the expiration of the 90-day minimum period of the notice of acquisition, notice of which was given on 29 June 2022. [33] They submitted that a request by a landowner for information about the public purpose is a matter which is clearly “in connection with” the acquisition. Further, the applicants said that “these proceedings arose because of Council’s refusal to provide further information”.

    33. See substantive judgment at [8], [64].

  2. The applicants’ position was that if the Court were to accept its submission that s 59(1)(a) of the Just Terms Act applies, then the costs of the proceedings should not be determined now. Rather, costs should be reserved to the determination by the Valuer-General of any compensation claim made or in any future Class 3 proceedings.

  3. Council submitted that s 59(1)(a) does not apply to the subject case and the applicants cannot rely on it to avoid the usual costs order that arises under r 42.1 of the UCPR. Council relied on Al Amanah College Inc v Minister of Education and Training (No 2) (Al Amanah College Inc), [34] where Biscoe J said at [26]:

26. … In my opinion, s 59(a) cannot be stretched to include legal costs directed to preventing acquisition rather than seeking compensation for it. A party who contemplates such an independent legal claim, outside the acquisition and compensation process, must look to any costs order in those separate proceedings.

34. [2011] NSWLEC 254.

Consideration

  1. It would have assisted the parties had Council provided a substantive response to Mr Weinberger’s letter of 16 February 2023.

  2. However, I do not find that such failure to respond to the letter amounts to “disentitling conduct” on the part of Council. Nor do I find that Council’s failure to respond to the letter was a breach of the Model Litigant Policy, or any model litigant obligations, so as to displace the presumption that costs follow the event. The proceeding was commenced by summons filed 28 September 2022. There is no evidence before the Court to suggest that a response by Council to Mr Weinberger’s letter of 16 February 2023, although perhaps helpful, would have led to the resolution of the proceeding that was already on foot.

  3. Further, I find that the proceeding was ordinary litigation, not brought in the public interest, but to protect the applicants’ private interests in the property.

  4. Nor do I find that ss 55 and 59(1)(a) of the Just Terms Act are applicable to this Class 4 proceeding. It would not be appropriate to reserve the question of costs, as the applicants have requested, to the determination by the Valuer-General of any compensation claim or in any future Class 3 proceeding. In accordance with Biscoe J’s decision in Al Amanah College Inc at [26], the costs of this proceeding, should be “separate” to any costs claimed under s 59 of the Just Terms Act.

  5. Accordingly, I do not find any basis upon which to depart from the general rule that costs follow the event.

  6. However, considering that Council’s failure to respond to Mr Weinberger’s letter of 16 February 2023 was central to the parties’ submissions on the question of costs, I will make an order that the parties pay their own costs in relation to the preparation of their submissions in relation to costs.

Apportionment?

  1. Council accepted that the apportioning of any costs order between the applicants is a matter for the Court exercising its power under s 98 of the CPA. As the second to sixth applicants sought to be joined to the proceedings as applicants, it would be appropriate that an order be made in respect of each of them in addition to the first applicant.

  2. I do not consider it necessary to make an order apportioning the costs between each of the applicants. I will make an order that the applicants pay the first respondent’s costs as agreed or assessed.

Orders

  1. The Court makes the following orders:

  1. The first, second, third, fourth, fifth and sixth applicants are to pay the first respondent’s costs in the proceeding Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51, as agreed or assessed.

  2. Each of the parties to pay their own costs in relation to the preparation of submissions on the question of costs.

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Endnotes

Decision last updated: 19 June 2023

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Cases Citing This Decision

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Cases Cited

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Statutory Material Cited

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Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51
AHB v NSW Trustee and Guardian [2014] NSWCA 216
Al Amanah College Inc v Minister for Education and Training (No 2) [2011] NSWLEC 254