The Owners - Strata Plan No. 76907 v Sydney Metro

Case •

[2025] NSWLEC 6

•

12 February 2025

No judgment structure available for this case.

Land and Environment Court


New South Wales

Medium Neutral Citation: The Owners – Strata Plan No. 76907 v Sydney Metro [2025] NSWLEC 6
Hearing dates: 12 February 2025
Date of orders: 12 February 2025
Decision date: 12 February 2025
Jurisdiction:Class 3
Before: Duggan J
Decision:

See orders at [40]

Catchwords:

PRACTICE AND PROCEDURE – notice of motion – leave to adduce expert evidence – failure to comply with the Court’s directions – applicant’s inexcusable delay in filing evidence – ss 56, 57 and 58 Civil Procedure Act 2005 – Uniform Civil Procedure Rules 2005 – prejudice to applicant – leave granted – indemnity costs

Legislation Cited:

Civil Procedure Act 2005 (NSW), ss 56, 57 and 58

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Aon Risk Services Australia Pty Ltd v Australian National University (2009) 239 CLR 175; (2009) 258 ALR 14; [2009] HCA 27

Category:Procedural rulings
Parties: The Owners – Strata Plan No. 76907 (Applicant)
Sydney Metro (Respondent)
Representation:

Counsel:
P Tomasetti SC and D Robertson (Applicant)
R Lancaster SC (Respondent)

Solicitors:
Baron & Associates (Applicant)
Ashurst (Respondent)
File Number(s): 2022/00035446
Publication restriction: No

EX TEMPORE JUDGMENT

  1. HER HONOUR: There are two motions before me. The first Notice of Motion is that brought by Sydney Metro (the Respondent in the main proceedings) filed on 22 January 2025 which in effect pursuant to order 1 in Annexure A to that order seeks leave that the Respondent be granted leave to adduce the expert evidence of Mr Grech, Mr Brooks, Mr Dickson, Mr Gearin and Mr Lavorato, all of which have been filed and served albeit several days late, the lateness being of short compass. Leave is not opposed in relation to that and accordingly I make the orders in accordance with pars 1 and 2 of the Respondent's Short Minutes of Order at Annexure A to its Notice of Motion. In relation to that Notice of Motion, I order that each party pay its own costs.

  2. The second Notice of Motion filed 31 January 2025 is opposed and is far more complex. The history of this matter is that the Owners – Strata Plan No. 76907 (the Applicant in the main proceedings) commenced these proceedings which are before me three years ago, on 7 February 2022. In the conduct of the matter, directions were made in respect of the filing of the Applicant's evidence on 24 November 2023, 22 March 2024, 21 and 28 August 2024. In that respect, the Applicant's architectural, town planning and heritage and evidence is the only evidence that has been filed in accordance with those directions.

  3. The Applicant now seeks leave to rely upon the evidence of a surveyor, geotechnical engineer, a structural engineer, a quantity surveyor and a valuer. The matter is in the state that it is in because the Applicant did not seek to relist the matter to obtain further directions in relation to the filing of the evidence until such time as the time for the filing of evidence had expired. As a consequence, the Applicant has lost its right to rely upon the leave that had been previously granted, the Applicant having not filed the evidence within time nor sought to vary the orders. The Applicant now finds itself in the position where it must seek leave to rely upon the expert reports.

  4. The Applicant has prepared and served some but not all of those reports. It filed and served its survey and geotechnical material on 2 December 2024, some 58 days after the last direction had been made for the filing of that evidence. On 3 December 2024, the structural evidence was filed and served, some 59 days after the last date upon which the direction was made for it to be served. Similarly, quantity surveying evidence was filed on 31 January 2025, some 93 days after the last direction was made for the filing of that evidence. The Applicant indicates that it has not filed its valuation evidence and will not be in a position to file it for ten weeks from 31 January 2025, which on my calculation takes us to 11 April 2025, which will be some significant period after the date upon which it was directed to be served.

  5. Despite repeated advice from the Registrars that liberty to relist would not be permitted, as the non‑compliance with the Court's directions negated the leave and that the Applicant still required a Notice of Motion to seek further leave, no Notice of Motion was filed until 31 January 2025, which is the motion that now comes before me.

  6. In considering whether or not leave should be granted, the parties both agree that the principles applicable are those set out in Aon Risk Services Australia Pty Ltd v Australian National University (2009) 239 CLR 175; (2009) 258 ALR 14; [2009] HCA 27 (Aon Risk) and additionally the matters to which I am directed in the Civil Procedure Act 2005 (NSW) (CP Act) in ss 56, 57 and in particular s 58, which sets out the dictates of justice to which I must have regard in deciding whether or not to make any order or direction in the management of the proceedings. The matters to which s 58 refers to some extent overlaps with and requires a consideration of the same matters that were enumerated in Aon Risk.

  7. Firstly, the nature and importance of the evidence which is a matter for consideration also under ss 57(1)(a) and 58(2)(iv) of the CP Act. I accept that absent the evidence that the Applicant seeks leave to adduce, the Applicant will be extremely limited in its capacity to meet both the factual preconditions that would give it jurisdiction to bring its case, and its case on value. Absent this evidence, the only evidence available to the Applicant is its architectural, town planning and heritage but there would be no evidence on value and there would be no evidence going to the statutory factual preconditions that it requires.

  8. The only basis upon which the Applicant could prosecute its case would be to cross‑examine the Respondent's witnesses. The Respondent's witnesses maintain, as I understand it, that the Applicant has not met its factual preconditions and would not be entitled to the value which it contends. It is unlikely that the cross‑examination would be sufficient to enable the Applicant to expose the full scope of its case and provide sufficient evidence to the Court to enable it to make appropriate submissions.

  9. I consider this prejudice, the nature and importance of the evidence to be essential to the Applicant's case and the prejudice that would flow to it from not being permitted to call this evidence, would be an extreme prejudice. That is, however, only one matter which is to be taken into account. I need to balance all of the considerations.

  10. The next consideration is the extent of the delay and the costs. This also arises under s 58(2)(ii) and (2)(iv) of the CP Act, together with the objects of the CP Act in s 57(1)(b), (c) and (d). It is apparent that there have been gross periods of extensive failure to comply with the directions of this Court, notwithstanding that three sets of directions have been made for the filing of the evidence and that the delays are significant. On its face, there is a flouting of the Court's role in the management of the case before it and the duties which flow to legal practitioners in ensuring the overriding purposes of the Court to facilitate the just, quick and cheap resolution of the real issues in proceedings is met. The duty of a legal practitioner and a party is set out in s 56(3), (4) and (6) as:

(3)   A party to civil proceedings is under a duty to assist the court to further the overriding purpose and, to that effect, to participate in the processes of the court and to comply with directions and orders of the court.

(4)     Each of the following persons must not, by their conduct, cause a party to civil proceedings to be put in breach of a duty identified in subsection (3)—

(a)   any solicitor or barrister representing the party in the proceedings,

(b)   any person with a relevant interest in the proceedings commenced by the party.

…

(6)   For the purposes of this section, a person has a relevant interest in civil proceedings if the person—

(a)   provides financial assistance or other assistance to any party to the proceedings, and

(b)     exercises any direct or indirect control, or any influence, over the conduct of the proceedings or the conduct of a party in respect of the proceedings.

  1. On one view, such a duty could be said to extend to those who are preparing reports in accordance with the directions made by the Court. It is fair to say that the extent of the delay is inexcusable. The just, quick and cheap resolution of the matters in circumstances where some three years after the filing of the proceedings, the Applicant has only just put itself in a position to file some, but not all of its evidence is a gross breach of the duties which are imposed. I will deal with the explanation in due course.

  2. The next issue is the issue of prejudice. Prejudice is clear. The Respondent's evidence could not engage with the Applicant's case, as the Applicant's case was formulated through its expert material which is different from the expert material upon which the case was first formulated. As a consequence, the evidence filed by the Respondent largely in conformity with the directions, is now rendered to an extent, if not whole, irrelevant. The time and cost incurred in the preparation of that material which is now no longer relevant is substantial and was incurred solely due to the Applicant's conduct in failing to comply with its obligations.

  3. As no hearing date has been fixed, and as the material has now in part been prepared, I accept that the prejudice, the clear prejudice which flows to the Respondent, can be met by the making of further directions in relation to the preparation of the evidence and orders requiring the Applicant to pay the Respondent's costs, such that the prejudice of the cost and delay can be overcome. That of itself is not a sufficient reason to warrant the granting of leave. That is merely because a respondent's prejudice can be met is not of itself sufficient to warrant the order as I must also consider the prejudice to the Court and the public which is one of the overriding purposes and objects of the CP Act. I will deal with that matter later.

  4. Mr Baron, the solicitor for the Applicant, being the solicitor on the record, has prepared an affidavit sworn 31 January 2025 in which he seeks to provide an explanation for the delay in the filing of the evidence firstly, and secondly, his delay in making an application to vary the orders that were not complied with, or alternatively to seek leave. The reasons for the delay are set out in par 29 of Mr Baron's affidavit which states:

The preparation of the applicant's non‑valuation evidence has regrettably taken longer than anticipated at the time of the orders of 21 August for various reasons including:

(a)   The requirement for experts to confer with each other in the preparation of their reports given the interrelated nature of the expert disciplines;

(b)   The resulting delays in the preparation of one expert report had a flow on effect to the others. That is the delay in finalising the Surveying Report impacted on the completion of the Structural Engineering Report and Geotechnical Engineering Report which in turn impacted on the completion of the Quantity Surveying Report;

(c)   The availability of experts, solicitors and counsel at times to confer in relation to the experts' draft reports due to preexisting work commitments;

(d)   The complexity of the tasks for the experts, particularly of as built underground tunnels and the review of voluminous electronic documents produced by Sydney Metro; and

(e)   Obtaining instructions from the applicant's strata committee.

He notes at par 30:

As soon as the experts finalised their reports they were duly served on Sydney Metro.

  1. The Respondent has observed in its submissions in this matter that the explanation of Mr Baron is deficient in detail in relation to an explanation for the delay. I accept the submissions of the Respondent and find that Mr Baron has provided little, if no real explanation of the delay.

  2. In particular, adopting the Respondent's observations at par 28 of their submissions dated 4 February 2025, Mr Baron has not provided any detail of:

  1. When the experts were instructed to prepare their evidence;

  2. When the draft reports were provided and settled;

  3. When meetings occurred between the experts, solicitors and counsel to settle reports;

  4. When each of the relevant experts, solicitors and counsel were unavailable and why each of them was unavailable;

  5. Why it took so long between August and December to serve the reports;

  6. Why the surveying expert report was delayed so long;

  7. Why TKD architectural plans prepared by the Applicant's architect dated 8 December 2023, were not provided to the Respondent as part of the Applicant's architectural evidence served on 26 February 2024;

  8. Why the structural engineering plans dated 27 March 2024, based on the TKD architectural plans dated 8 December 2023, were not provided to the Applicant's planner and heritage experts prior to those experts preparing their reports and why they were only served on the Respondent ten months later and after the Respondent served its non‑valuation evidence; and

  9. Why the Applicant's quantity surveying report was only served on 31 January 2025.

  1. As is apparent from even a casual reading of the Court's practice note, there is an obligation in seeking leave to vary directions for the filing of evidence where those directions remain on foot, let alone when leave is being re‑sought due to a delay, an application is required as per par 50 of the practice note to identify the reason for the need of the variation and the time upon which both the expert and the legal practitioner or party first became aware of the need for the variation. On the evidence that is provided by Mr Baron, there is no such explanation.

  2. Evidence has also been adduced by Mr Standen, the Applicant’s expert structural engineer. Mr Standen again deals both with the issue of the delay and the filing of the evidence. However, he does not provide any of the detail identified in the practice note, nor the detail identified in the Respondent's submissions that would enable an understanding to be obtained. Both Mr Baron and Mr Standen see the tipping point being the 21 August 2024 directions, however, the delay in relation to the filing of the evidence must in fact be judged from when the first directions were made on 24 November 2023 and not been complied with. The degree of delay and non‑compliance in this matter, is compounded by the fact that three sets of directions have been made and three sets of directions have not been complied with, with no reasonable explanation.

  3. Neither a legal practitioner nor an expert can expect to merely produce material when it becomes available, or late, due to the availability and work commitments of that legal practitioner or expert. The practice note requires both the legal practitioner and the expert to be satisfied upon the making of the directions that such directions can and will be complied with. This requires proactivity, ensuring compliance with the directions and if due to valid reasons cannot be met, immediately leave must be sought.

  4. Mr Baron's explanation as to why he did not seek leave was that he considered that it would be, at pars 42 to 44 of his affidavit:

42   …The intention was to procure all outstanding reports prior to the filing of the Notice of Motion. On mature reflection, and regrettably, a notice of motion should have been filed when the applicant first became aware that there would be slippage in the timetable. This occurred shortly before 10 September when no surveying, geotechnical or structural reports had been finalised.

43   It was considered (erroneously, now on reflection) this approach would be more cost effective to the parties and a more efficient use of the Court's resources as opposed to the applicant's filing a notice of motion prior to the applicant's experts having finalised their reports.

44   The applicant's representatives were also mindful of avoiding any further breaches of the Court's orders based on the history of the matter and the difficulties experienced in procuring the expert evidence.

  1. Mr Baron's approach to case management in this matter, appears to be that he can ignore the Court's directions and the Court's practice notes and for himself, form an opinion as to what the appropriate course and conduct is. In engaging in that behaviour, he has ignored both his duty under the CP Act and his obligations under the practice direction. I do not know whether it was Mr Baron, that is the solicitor himself, the experts or the Applicant that have caused the delay, however, Mr Baron has chosen to go on evidence. He is the solicitor on the record. His being the only explanation I therefore must attribute the delay to him.

  2. The price of the failure to comply with the Court's practice note because of the decisions made by Mr Baron and those that advise the Applicant and perhaps the Applicant itself, is that they have lost the conditional leave that was granted to them. Any casual reading of the practice note would have shown that, that price was the price that would be paid if the approach taken by Mr Baron was adopted. Both the Applicant, the experts, and the legal practitioner should have been well aware of that risk upon even a casual reading of the practice note or the Uniform Civil Procedure Rules 2005 (NSW). The loss of the leave can only be attributed to the Applicant's choices. It lost its leave by its behaviour. Its leave and the prejudice that flows from it is both unexplained and largely are of the Applicant's own making.

  3. I do not accept that the Applicant has acted in a way to obtain a forensic advantage, that is, has made conscious decisions not to file the evidence so as to obtain an advantage in the proceedings over the Respondent. I do, however, accept that the Applicant finds itself in this position by its own deliberate choices. For example, Mr Dale, the Applicant's former valuer, ceased to act for the Applicant on the evidence of Mr Baron in August 2024, occasioning the need to retain a further valuer. Mr Hillier was retained on 27 September 2024. There is no explanation as to whether Mr Hillier was advised of the need to prepare his evidence or that his evidence was already beyond the scope of the directions, nor any indication as to why Mr Hillier requires ten weeks, a significant and substantial period of time, after the filing of the quantity surveyor's report, in circumstances where both the quantity surveyor's report and the valuation report were well beyond the scope of the directions that had been made.

  4. There is no explanation why he was engaged when clearly he was unable to comply with the Court's directions. There is no explanation as to why the surveyor or the quantity surveyor were unable to comply with the directions. Whilst these are not forensic decisions or perhaps not active decision-making, it is unacceptable for inaction to give rise to such gross and inexplicable breaches of the Court's directions.

  5. The next matter for consideration is the public prejudice. That is, that the public are entitled to have regard to the overriding purpose for the just, quick and cheap resolution of the proceedings, and the duties that are conferred upon parties. The objects of the case management include the efficient disposal of the businesses of the Court and the efficient use of available judicial and administrative resources, and the timely disposal of the proceedings and all other proceedings in the Court at a cost affordable by the respective parties.

  6. In relation to the dictates of justice, I am also required to have regard to the use that a party has made, or could have made, or any opportunity that has been available to the party in the course of the proceedings, whether under the rules of the Court, the practice of the Court or any directions of the Court given the nature of the proceedings, as well as the difficulty or complexity of the issues that the proceedings give rise.

  1. Conduct, such as that disclosed by the Applicant, as I have indicated, indicates a disregard for the Court's direction and undermines the public's confidence in the Court. It also delays the disposal of these proceedings, which due to the Applicant's inaction, means that some three years after the proceedings have been commenced, the proceedings are not yet in a state in which they could be fixed for hearing. This is solely due to the Applicant's conduct in this matter. The attempts of explanation are nothing more than an attempt to excuse inexplicable inactivity.

  2. It is suggested by Mr Tomasetti, senior counsel for the Applicant, that proceedings such as these are somehow special, insofar as they relate to the compulsory acquisition of the Applicant's land and that somehow that special nature overcomes the considerations of prejudice to the public and the Respondent, because the Applicant would not be able to challenge the decision-making to compulsorily acquire its land.

  3. I accept that the Applicant has had to bring these proceedings because the land was compulsorily acquired. I accept that due to Court of Appeal authority, that some consideration to that nature of proceedings, is brought to bear in the consideration of the exercise of discretion on costs at the conclusion of the hearing. However, the nature of the proceedings does not give the Applicant special liberty or licence to ignore the case management proceedings in the Court. It does not give it leave or licence to fix its own rules in relation to how it chooses to conduct the proceedings and it does not give it leave or licence to ignore the directions of the Court in such a gross and inexplicable manner.

  4. That being said, the Court finds itself in an invidious position brought about solely by the conduct of the Applicant, that the Applicant will be left with a prejudice which is unable to be cured if leave is not granted to permit it to rely upon the evidence, that would permit it to put the case in the manner which it proposes. I say an invidious position in that due to the lack of explanation, due to the prejudice, due to the conduct of the Applicant in ignoring and failing to comply with the Court's directions on numerous occasions, the prejudice to the members of the public and the manner in which the public views the requirement to comply with the Court's directions is undermined and cannot be cured.

  5. However, the prejudice is such to the Applicant that I find myself in a position where I am extremely reluctant to make this direction, but I can do nothing else but to grant the leave that the Applicant seeks. That leave, however, in order to overcome the prejudice to the Respondent must be made on conditions. The first condition is that the Applicant will no longer be entitled to consider the Court's directions as merely suggestions. Any further directions that the Court makes in relation to the filing of evidence will be done on a basis that leave will not be granted in the future for any further extension, unless there are exceptional circumstances.

  6. Secondly, I accept as I have indicated that the Applicant's conduct has caused the Respondent to incur the costs of the preparation of evidence, which is either in whole or in part no longer relevant, such that the Respondent will be required to prepare reports that address the material which has been provided and which will be provided in the reports for which I give leave. Those costs are not yet able to be identified, but in order to provide for the just, quick and cheap, and I add efficient conduct of the matter, I accept that it is necessary for the Respondent to prepare a new report, that will in whole be able to be read in the proceedings.

  7. That may involve translocating some parts of a report that have already been prepared. It may require some further consideration of material that is now produced, and it may involve different decision-making. To that extent, I consider that the Respondent's costs thrown away as required by the necessity for it to incur further costs in the preparation of those additional reports, should be met by the Applicant.

  8. The Respondent seeks a special cost order in that regard which is opposed by the Applicant. That is, the Respondent seeks that its costs be paid on an indemnity basis. I accept this submission. The Applicant's conduct, as I have indicated, represents an indulgence which arises as a consequence of its conduct in grossly failing to comply with the Court's directions on numerous occasions, but in particular in relation to the length and unexplained delay of the reports it now seeks leave. Notwithstanding the duty that it had, that is, the Applicant had, to comply with those obligations under the duty conferred by the CP Act, in those circumstances I consider that the prejudice can only be met by the order being on a special basis and I will make an order that those costs be on an indemnity basis.

  9. To the extent that there is a prospect that the Applicant may be entitled to its costs in the proceedings, I will also make an order on the same basis that the costs thrown away in the proceedings as a consequence of the Applicant's conduct would be the Respondent's (the Applicant's costs incurred in considering the further reports and the earlier reports) will be the Respondent's costs in the proceedings.

  10. The Applicant suggests that there should be no order for costs in relation to the Notice of Motion. I find that submission inexplicable in the circumstances. The motion was brought about as I said by the conduct of the Applicant. It is appropriate that the Applicant pay the Respondent's costs of its Notice of Motion and for the same reasons it will be on the indemnity basis.

  11. For those reasons, I make the orders sought in pars 1 and 2 of the orders sought in the Applicant’s Notice of Motion filed 31 January 2025. I note that the report by Mr Hillier is due on 9 April 2025, and I indicate that no further time will be granted to extend that time except in exceptional circumstances. I order that the Respondent's costs thrown away, represented by its requirement to incur further costs to prepare further reports, be paid by the Applicant on an indemnity basis.

  12. I order that the Applicant's costs in the proceedings relating to the preparation of those new reports and the consideration of the earlier reports will be the Respondent's costs in the proceedings on an indemnity basis. I order that the Applicant pay the Respondent's costs of its Notice of Motion filed 31 January 2025 on an indemnity basis.

  13. This matter due to the Applicant's conduct is also now in a state where it can no longer be left to the ordinary management of the Court's list. I consider that it is appropriate that this matter be conveyed to the Court's complex matters list, and I list the matter for case management before me on 10 April 2025 at
    9am at which time Mr Hillier's report will have been filed. The parties can make application for any further directions that they seek, in the future conduct of the matter.

Orders and directions

  1. The Court orders:

  1. Make orders in accordance with paragraphs 1 and 2 of the Short Minutes of Order, forming Annexure A to the Respondent’s Notice of Motion filed on 22 January 2025.

  2. Each party is to pay its own costs in relation to the Notice of Motion filed on 22 January 2025.

  3. Leave is granted to the Respondent to rely upon evidence in the areas of geotechnical and quantity surveying. The names of the experts are to be provided at the case management on 10 April 2025.

  4. Leave is granted in accordance with paragraphs 1 and 2 of the Applicant’s Notice of Motion filed on 31 January 2025 on the following conditions:

  1. The Respondent’s cost thrown away in connection with the necessity for the Respondent to consider the Applicant’s evidence and provide evidence responding to that evidence, is to be paid by the Applicant on an indemnity basis; and

  2. The Applicant’s costs relating to the preparation and consideration of the Respondent’s evidence referred to in (a) above, is to be the Respondent’s costs in the proceedings.

  1. The Applicant is to pay the Respondent’s costs of its Notice of Motion filed on 31 January 2025 on an indemnity basis.

  2. The Applicant is granted to leave to file any supplementary expert report by the person whom leave has been granted per order (4) above, to address the subject matter of the architecture plans and report of Peter Standen. Such evidence is to be filed and served by 27 February 2025.

  3. The proceedings are listed in the Complex Matter List.

  4. Adjourn the proceedings to Thursday 10 April 2025 for case management at 9am before Duggan J.

  5. Liberty for the parties to apply for further directions.

Note: The report of Dwight Hillier and any report referred to in (6) above shall be filed in accordance with the direction made and no further extension of time will be granted for any expert evidence, except in exceptional circumstances.

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Decision last updated: 20 February 2025

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