Tunwish Pty Ltd v Port Stephens Council

[2009] NSWLEC 1213

Land and Environment Court

of New South Wales

CITATION:	Tunwish Pty Ltd v Port Stephens Council [2009] NSWLEC 1213
PARTIES:	APPLICANT Tunwish Pty Ltd RESPONDENT Port Stephens Council
FILE NUMBER(S):	10753 of 2008
CORAM:	Acting Registrar Gray
KEY ISSUES:	COSTS :- Amended Application
LEGISLATION CITED:	Civil Procedure Act 2005 Uniform Civil Procedure Rules 2005 Land and Environment Court Rules 2007
DATES OF HEARING:	23 February 2009
DATE OF JUDGMENT:	26 February 2009
LEGAL REPRESENTATIVES:	APPLICANT Mr CR Ireland SOLICITORS O'Sullivan Saddington RESPONDENT Mr P W Larkin SOLICITORS Harris Wheeler

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

ACTING REGISTRAR GRAY

THURSDAY 26 FEBRUARY 2009

08/10753 Tunwish Pty Ltd v Port Stephens Council

JUDGMENT

1 ACTING REGISTRAR: This is an application made by the respondent for costs. The respondent asks firstly for its costs thrown away as a result of an Amended Application being filed by the applicant, and secondly for its costs of the Notice of Motion filed by the respondent seeking leave to file the Amended Application.

2 The substantive proceedings arise from the decision of council granting development consent for the use of the subject property, a hotel premises, as a place of public entertainment subject to conditions. Specifically, the applicant seeks to appeal against the decision of the council to impose condition 4, which condition restricts the opening hours for the place of public entertainment. The applicant says that the hotel currently operates in longer opening hours than those allowed for in condition 4, and that therefore they should not be restricted to using the property as a place of public entertainment in hours more limited than those for which the hotel itself is open. In its Amended Statement of Facts and Contentions filed 19 November 2008, the applicant relies on development consents granted by the council in 1980 and 1988. The applicant asserts that these consents do not impose a restriction on the hotel trading hours.

3 The respondent council says that condition 4 was necessitated by reason of condition 2 of a conditional development consent granted in 2003. That consent was for alterations and additions to the use of the existing hotel premises. Condition 2 of the development consent granted in 2003 provides that “the development shall take place in accordance with the plans and documentation submitted with the application.” The respondent then relies on the Statement of Environmental Effects that was submitted in support of the 2003 development application, which sets out the shorter trading hours of the hotel and indicates that the development proposal involves no change to those hours. The respondent therefore says that condition 2 imposed a restriction on the trading hours in accordance with the operating hours set out in the Statement of Environmental Effects.

4 The respondent’s construction of condition 2 is disputed by the applicant and this question will therefore be the subject of a determination to be made at the hearing of the proceedings. Whilst this was initially to be determined by a Judge as a preliminary question, the Chief Judge determined that it would be more appropriately dealt with at the final hearing of the proceedings. Following this determination and after the ensuing directions hearing before the Registrar on 31 October 2008, the Applicant filed an Amended Statement of Facts and Contentions.

5 In paragraph 32(b) of its Amended Statement of Facts and Contentions the applicant also contends that condition 4 should be altered whether or not the Court finds that condition 2 of the 2003 consent imposes a limitation on hours different to those hours in which the hotel currently operates. Whether or not the Court has the power to make such an order is disputed by the respondent and that too will be a matter for the Court to resolve at the hearing.

6 A Notice of Motion was filed on 24 December 2008 seeking leave to file an Amended Application. The nature of the amendment was to seek an alternative order to the relief sought in paragraph 1. The alternative relief sought, contained in paragraph 2, simply articulates what was previously outlined in paragraph 32(b) of the Applicant’s Amended Statement of Facts and Contentions. It seeks the deletion and replacement of condition 4 even if the Court finds that condition 2 of the 2003 consent restricts the hours of operation of the hotel. The order sought in the Notice of Motion was granted by consent, save for the question of costs.

7 The respondent submits that it is entitled to its costs on the basis that it provided numerous opportunities to the applicant to amend its application. In support of its costs application the respondent has tendered a bundle of documents which I marked as Exhibit 1. That bundle contains transcript from directions hearings before the former Registrar on 22 October 2008 and 31 October 2008. These directions hearings followed the filing of a Notice of Motion by the applicant seeking, inter alia, that they be granted leave to file an Amended Statement of Facts and Contentions. On 31 October 2008, the question of the Amended Statement of Facts and Contentions was discussed. On that occasion, the respondent indicates its concerns with the proposed amended document, and suggests that the applicant further amend the document to set out its case if the Court finds against it on the issue of the construction of the 2003 development consent. Counsel for the respondent refers to this discussion as the first ‘warning shot’ fired at the applicant.

8 The same issue was then articulated in a letter addressed to the applicant and dated 11 November 2008. Paragraph 6(b) of that letter clearly indicates that the proposed Amended Statement of Facts and Contentions contains no alternative case to be relied upon by the applicant. Whether the applicant sought to put an alternative case was a legitimate concern for the respondent because of the evidence that would be required to meet such an alternative case. Obviously if the respondent’s construction of the 2003 consent was upheld by the Court, that would be a complete and decisive answer to the case unless an alternative case is offered by the applicant. Counsel for the respondent describes this letter as the second ‘warning shot’ fired at the applicant.

9 Finally, counsel for the respondent submits that the third warning shot was fired by paragraph 12 of the respondent’s Statement of Facts and Contentions in reply. That paragraph refers to the fact that no appeal has been brought against the 2003 Consent or Condition 4 of the 2003 Consent, nor has any application for modification of that condition been made. On the respondent’s submission, these three opportunities were not taken by the applicant to file and rely on an amended application. Given that these opportunities were provided to the applicant and not taken, the respondent submits that it is appropriate not only for me to make an order that the applicant pay the respondent’s costs thrown away by reason of the amended application, but also for the costs of the Notice of Motion filed by the applicant on 24 December 2008.

10 The respondent also draws my attention to the commentary in Ritchies Uniform Civil Procedure NSW in relation to section 64 of the Civil Procedure Act 2005. Paragraph 64.45 of that commentary indicates that the court has discretion to grant an amendment to a document on terms, including making an order for the costs thrown away as a result of the amendment.

11 The Applicant makes a number of submissions as to why it ought not pay the respondent’s costs. Firstly, the applicant submits that the amendment to the application is only for the purpose of giving specificity to the proposed amendment to condition 4 of the development consent. It submits that the original application would have been sufficient to deal with the concerns raised by the respondent in the three warning shots alleged to have been given by the respondent.

12 Secondly, the applicant submits that the Amended Statement of Facts and Contentions also adequately dealt with those issues that were raised on three occasions. The amendment to the application was only made in order to resolve any residual doubt in the mind of the respondent as to whether the applicant sought to offer an alternative case if it failed on the issue of construction of the 2003 Consent. Notwithstanding this, on the submission of the applicant the alternative case was sufficiently provided for by the Amended Statement of Facts and Contentions.

13 Thirdly, in relation to the costs of the Notice of Motion the applicant points out that it was successful in obtaining prayer 1 of the Notice of Motion by consent. The applicant says that in those circumstances it is usual for costs to be awarded in favour of the party who was successful on the Notice of Motion in accordance with Rule 42.1 of the Uniform Civil Procedure Rules 2005. Accordingly, the applicant submits that it would not be appropriate for me to make an order awarding costs in favour of the respondent, who was unsuccessful on the Notice of Motion.

14 The Applicant has also tendered a letter dated 12 November 2008 from its solicitors to the respondent’s solicitors in support of its submissions. That letter shows that the applicant has been quite reasonable in responding to the issues raised by the respondent. At various points, the letter makes clear that the applicant does not concede the respondent’s points, but notwithstanding that makes various amendments to the Amended Statement of Facts and Contentions in order to avoid unnecessary disputes. The applicant also submits that the facts demonstrate that it has responded promptly to each concern raised by the respondent, and it should not be criticised for doing so.

15 It is common ground between the parties that I have the power to make an order for costs. That power arises pursuant to section 98 of the Civil Procedure Act. It must be exercised in accordance with the Uniform Civil Procedure Rules 2005, which arise under the Civil Procedure Act 2005. However, pursuant to Rule 1.7 of those rules, the Land and Environment Court Rules2007 prevail over the Uniform Civil Procedure Rules 2005. The applicant draws my attention to the fact that, pursuant to Rule 3.7 of the Land and Environment Court Rules, I must be satisfied that in the circumstances it is fair and reasonable to award costs in favour of the respondent. The applicant submits that this sets a higher bar for the respondent to establish that a costs order is appropriate.

16 The respondent council says that it would be an error of law for me to use the Land and Environment Court Rules to fetter my discretion to order costs. The respondent also says that the power of the Court to grant amendments pursuant to section 64 of the Civil Procedure Act 2005 overrides the court rules in relation to awarding costs. I cannot accept either of those submissions. Whilst section 98 of the Civil Procedure Act 2005 provides the Court with power to make an order for costs, the exercise of that power must be in accordance with the rules of the Court. Further, I cannot accept that the terms of section 64 have any bearing on whether I should award costs. Therefore, to make an order for costs in these proceedings, I must be satisfied that it is fair and reasonable to do so in accordance with Rule 3.7 of the Land and Environment Court Rules. Whilst 3.7(3) sets out the circumstances in which the Court may find that the making of the costs order is fair and reasonable, it does so without limiting the circumstances in which the Court may make such a finding.

17 I accept that the amended application simply gave specificity to the contentions already contained in the Applicant’s Amended Statement of Facts and Contentions. Whilst the issues were raised in the call-over before the Registrar, those issues were said to be resolved by the applicant further re-considering the Amended Statement of Facts and Contentions on which it relied. The applicant amended its Statement of Facts and Contentions in accordance with the first two ‘warning shots’ that the respondent says were fired. I cannot accept the respondent’s submission that the applicant did not take the opportunity to provide an alternative case following the directions hearing on 31 October 2008 and the letter dated 11 November 2008. Further, there was no specific discussion in relation to amending the application.

18 However, in my view the applicant should have been well aware of whether the resolution of the issues identified by the respondent in the call-over on 31 October 2008 would require the amendment of the relief sought by the applicant. The original application, together with the original Statement of Facts and Contentions, put the respondent in a situation where the case it had to answer was simply one of construction of the 2003 Development Consent. As a result of the subsequent amendments to both of those documents, the case that the council has to answer has altered significantly. The case now requires the respondent council to obtain expert evidence. In my view these circumstances establish that it is fair and reasonable for the costs of the respondent thrown away by the filing of the amended application be paid by the applicant.

19 I accept the submission of the applicant that, given the nature of the amendment to the document, it is difficult to see how there may have been costs thrown away as a result of the amendment. However, in my view this is a matter for a costs assessor and not for my determination. Accordingly it should not preclude me from making a costs order in favour of the respondent for the costs thrown away as a result of the filing of the Amended Application.

20 Turning now to the costs of the Notice of Motion filed by the applicant, I cannot find that it is fair and reasonable for the applicant to pay the respondent’s costs. The applicant acted quite reasonably in notifying the respondent of its intention to amend the application following receipt of the respondent’s Statement of Facts and Contentions in Reply. Following the provision of that notice to the respondent, the applicant filed a Notice of Motion to bring the application to amend the document before the Court. Again, notwithstanding the agreement by the respondent to the filing of the Amended Application, the applicant acted reasonably in filing the Notice of Motion given that it is a requirement to do so under the Practice Note. Even if the applicant had resolved earlier in the proceedings that it required to file an amended application, the Notice of Motion would nonetheless be necessary. Further, there was negligible delay caused by the conduct of the applicant in this respect. Accordingly, the circumstances fail to establish that it would be fair and reasonable for the applicant to pay for the respondent’s costs of the Notice of Motion. This is particularly so given that it is the conduct of the respondent that has caused the costs of the Notice of Motion to be further incurred by both parties by pressing the question of costs and obtaining adjournments to do so. However, there is no application by the applicant for its costs of the Notice of Motion and I therefore make the order sought by the applicant, that is that each party pay their own costs in relation to the Notice of Motion filed 24 December 2008.

21 I therefore make the following orders:

1. That the applicant pay the respondent’s costs thrown away by reason of the amendment made on 22 January 2009;
2. That each party pay their own costs of the Notice of Motion filed 24 December 2008.
3. The exhibits tendered on the application be returned.

___________________

Registrar of the Court