Wills v Minerva Coal Pty Ltd
[1999] QLC 2
•9 February 1999
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LAND COURT
BRISBANE
9 FEBRUARY 1999
In the matter of an appeal against the determination of the Mining Warden's Court, Emerald, of compensation payable in terms of Section 282 of the Mineral Resources Act 1989 in respect of Mining Lease No. 70145 in the Emerald Mining District. (A97-63)
Michael J Wills
Appellant
v.
Minerva Coal Pty Ltd
Respondent
Determination and Orders
On 27 November 1998 I published my reasons concerning an appeal to this Court from a determination of the Wardens Court awarding compensation with respect to the proposed grant of a mining lease to the respondent over land owned by the appellant. In my reasons I indicated the quantum and nature of the compensation I intended to determine, however, invited the parties to make further submissions on the question of my jurisdiction to determine any amount under s.281(4)(e) Mineral Resources Act 1989 (MRA) with respect to "business inconvenience" arising out of the probable imposition of Capital Gains Tax on the proceeds of compensation. In due course the parties informed me that the issue of the sum for "business inconvenience" had been agreed between them at $25,000. In view of this, the only matters that remain to be dealt with are the question of costs and the final orders. The determination and orders, including orders for costs, were made in Chambers on 27 January 1999. I now publish the determination and orders and the supporting reasons.
The instant appeal was one of three appeals and a cross-appeal heard together. Apart from some brief documentary evidence the appeals were heard on the record with substantive submissions being made over a period of 2½ days. Part of that time was taken up with the issue of the form in which certain additional evidence should take, the issue of the admissibility of such additional evidence being dealt with earlier.
The Relevant Law
The appeal comes to the Land Court pursuant to s.282 MRA and s.282(6) provides that this Court "may make such orders as to costs of the appeal as it thinks fit". So far as I am aware, there is no authority on the question of costs arising under s.282(6) upon which I can rely. A number of appeals have been dealt with under the MRA and under earlier legislation but, for reasons I need not elaborate on, they offer no guidance to me. I refer to: Shaw v. Heritage Holdings (1992) 14 QLCR 139; Smith v. Cameron (1986) 11 QLCR 64 and Buchholz v. Great Mines Ltd (1987) 11 QLCR 269.
The power to award costs is in all jurisdictions a power derived from statute. The Full Court (Wyatt v. Albert Shire Council (1987) 1 QdR 486) had to consider the statutory power granted to the then Local Government Court by s.31(1) of the City of Brisbane Town Planning Act 1964. Section 31(1) provided:
"(1) The Court may make such order as it thinks fit as to the costs of any proceedings before it, including allowances to witnesses attending for the purpose of giving evidence at the hearing."
The following quotation from the judgement of the Court is taken from pp.488-489:
"Under s.31 of the Act the discretion of the Local Government Court with respect to costs is complete; or, as Macrossan J. in Assignment Pty. Ltd. V. Kirby [1981] Qd.R. 129, 134, said of a similar power vested in the Licensing Court, the discretion is 'full'. To say that, however, is not to say that the discretion may be exercised in an arbitrary manner. In England, where since 1890 the discretion of the High Court over costs is also acknowledged to be unfettered by statute, it continues to be recognized that the discretion must be exercised judicially: see Knight v. Clifton [1971] Ch. 700. As the judgments in that case show, such a power does not exclude resort to the 'settled practice' of a court where such a practice has evolved; but, to refer once again to what was said by Macrossan J. in Assignment Pty. Ltd. V. Kirby, supra, a purported exercise of discretion 'which fails because the mind is closed to relevant considerations through a rigid adherence to preconceptions' involves an error of law that is open to correction on appeal.
In the case, therefore, of the discretion under s. 31, which is both full and recently conferred, one must start with no preconceptions as to its exercise, save that it must be exercised 'judicially'. That can only mean for reasons that can be considered and justified."
I think that what the Court said on that occasion is relevant to the jurisdiction presently under consideration and I intend to be guided by it.
The reports are replete with cases dealing with the issue of costs and many were referred to by counsel in submissions. I now set out, without elaboration, those general principles which are relevant to this case.
In Hughes v. Western Australian Cricket Association (Inc) & Ors (1986) ATPR 40-748 ("Hughes") Toohey J said at 40-748:
"1. Ordinarily, costs follow the event and a successful litigant received his costs in the absence of special circumstances justifying some other order. Ritter v. Godfrey (1920) 2 K.B. 47.
2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. Foster v. Farquhar (1893) 1 Q.B. 564.
A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, 'issue' does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law. Cretazzo v. Lombardi (1975) 13 S.A.S.R. 4 a p.12." ("Cretazzo")
(See also Byrns v. Davie (1991) 2 VR 568 and Queensland Wire Industries Pty Ltd v. Broken Hill Pty Co Ltd (1987) 17 FCR 211).
In Dodds Family Investments Pty Ltd v. Lane Industries Pty Ltd (1993) 26 I.P.R. 261 ("Dodds") the Full Court of the Federal Court of Australia observed that the propositions enunciated by Toohey J. in Hughes are:
"… subject to the further consideration that justice may not be served if, parties are dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case … In Trade Practices Commission v. Nicholas Enterprises Pty Ltd (No. 3) (1979) 42 F.L.R. 213; 28 ALR 201, Fisher J. regarded the discretion to apportion costs as one to be exercised only in the most exceptional circumstances. Nevertheless he accepted that where a considerable part of the trial is taken up in determining issues upon which a party fails, it is a proper exercise of the discretion to reduce the costs allowed to that part. Generally speaking, and notwithstanding the considerations referred to by Toohey J. and the other authorities mentioned above, the demands of the community for greater economy and efficiency in the conduct of litigation may properly be reflected in a qualification of the presumption that a successful party is entitled to all its costs." (pp. 271-272)
What I have taken from "Dodds" is reflected also in the following quotation taken from Cretazzo at 16:
"But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases area alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues."
The following quotation is taken from Courtney Creche Pty Ltd v. Okko's Fine Art and Custom Framing Pty Ltd, 22 June 1995 (unreported Supreme Court of New South Wales) at 24:
"There is always a reluctance to make an order for costs against a successful party and ordinarily the court will only do so if there are special factors present, Donald Campbell and Co Ltd v Pollack [1927] AC 732; Deen v The Different Drummer Pty Ltd [1977] ACLD 526. Although most of the cases deal with successful defendants, the rule is basically the same for both plaintiffs and defendants, Ritter v Godfrey [1920] 2 KB 47, 52 approved in Campbell's Case at 814. Again, the authorities show that, normally, the successful party should get its costs even if it succeeds on some issues only, unless some issue was dominant or separable. The first question will often be whether the plaintiff can be said to be successful or substantially successful. Thus a plaintiff who receives only nominal damages when it had sought substantial damages is not categorized 'successful'; Alltrtans Express Ltd v CVA Holdings Ltd [1984] 1 All ER 685, 690-692."
Given the agreement between the parties as to "business inconvenience" that issue was not tried through to completion by this Court; however, it is my understanding of the authorities that, in considering the issue of costs in such circumstances, I should and will, in due course, make an assessment of the outcome that might have resulted had the issue been finalised. (See R v. Gold Coast City Council; ex parte Raysun Pty Ltd (1971) QWN 13 and R v. Wilkey; ex parte Cooke (1991) 2 QdR 447).
The process leading to the proposed grant of a mining lease to which the appellant has been exposed was not of his making. It was initiated by the respondent and bears some of the characteristics of a compulsory acquisition of land: a procedure provided under the Acquisition of Land Act 1967 (AOL Act) or the Land Act 1994. Section 27 of the AOL Act provides:
"27.(1) Subject to this section, the costs of and incidental to the hearing and determination by the Land Court of a claim for compensation under this Act shall be in the discretion of that court.
(2) If the amount of compensation as determined is the amount finally claimed by the claimant in the proceedings or is nearer to that amount than to the amount of the valuation finally put in evidence by the constructing authority, costs (if any) shall be awarded to the claimant, otherwise costs (if any) shall be awarded to the constructing authority.
(3) Subsection (2) does not apply to any appeal in respect of the decision of the Land Court or to costs awarded pursuant to section 24(3)or section 25(3)."
That provision has been considered on a number of occasions, however, it is to be noted that s.27(2) applies at first instance only and does not apply to the Land Appeal Court where the discretion with respect to costs is not fettered by statute (see Moyses v. Townsville City Council (1979) 6 QLCR 271 at 279). The effect of s.27(2) is not, however, one of indicating the manner in which the discretion given to the Court is to be exercised (see Moyses at 274), but it provides an arithmetic trigger which points to the party in whose favour the discretion to award costs may be exercised. That discretion must then be exercised judicially. In the case of the compulsory acquisition of land, the right to compensation is granted by the statute not by the Court, with the result that there can be some difficulty in forming a view as to who "won". On one view any substantial increase above the constructing authority's figure might be seen as sufficient in the absence of contrary factors, to invite an order for costs in favour of the claimant. Section 27(2), however, superimposes on the matter.
Such an arithmetic trigger is not, however, provided with respect to appeals to the Land Appeal Court or under the MRA to this Court, therefore the question of costs is to be considered by reference to general principle. At first instance in a matter such as the present, involving as it does a process with compulsory characteristics, one can expect a Court to act with restraint in considering an award of costs against a land owner whose success was limited unless, of course, he has acted vexatiously or dishonestly or has provided a grossly exaggerated claim (see Banno v. Commonwealth (1993) 81 LGRA 34 at 53). This compulsory aspect would generally be of reduced significance in an appeal, in my view. In the case of an appeal, whether it be with respect to a matter arising under the AOL Act or the MRA, the nature of the contest changes from that which prevailed at first instance, for the appellant has taken on the burden of bringing about a change to the initial determination. In addition, the task of identifying the successful party becomes a little easier, especially where the appeal is conducted largely on the record. Nevertheless, there will be cases where the compulsory nature of the action will remain as a matter of significance in an appeal. This is one such case given the complexity of the legislation under consideration: a matter I address below.
The Relevant Matters
I now turn to consider the matters which are relevant to my consideration of the question of costs.
The appellant in the present matter enjoyed some success with respect to the question of land valuation and disturbance, having compensation increased by $102,165.10 on my assessment and $25,000 by agreement, together totalling $127,165.10. This is greater than a marginal increase over the determination at first instance of $941,813. Depending on how one calculates the figure, the claimant sought an increase in the vicinity of $880,000, together with an indemnity with respect to the anticipated Capital Gains Tax assessment. Contrasted with this, the increased award is not large.
I should offer a comment concerning the matter "business inconvenience". I was prepared to find that there was sufficient evidence for me to settle on an amount under this head, however, I was aware that the respondent had indicated an intention to submit to the contrary. My main concern, however, related to the question of jurisdiction. I felt that the conclusion that I was comfortable in drawing may not have been supported by the appeal grounds. Ground 19 did say "The Warden erred in not being satisfied that there are grounds on which an additional amount of compensation more than the 10% minimum could be awarded". It may be that this ground could have been referred to by the appellant as the basis for my awarding an additional amount under s.281(4)(e) for "business inconvenience". Against this is the fact that this ground was directed towards quite another matter, in argument. This is unsurprising given that the notion of "business inconvenience" was not raised by either party, but was a matter identified by me independently.
On balance, and without the benefit of submission, I lean to the view that I did not have jurisdiction to make any award for "business inconvenience" as it was not a matter made "relevant to the appeal" (s.282(5)). In those circumstances, and given that "business inconvenience" was not a matter raised by the parties, this matter is not relevant to the question of costs.
When one views the grounds of appeal overall, the appellant can be said to have been generally unsuccessful. In considering this aspect, it is important to note that not each ground was of equal weight in the context of the appeal, nor for that matter was each ground independently pursued. Three grounds were abandoned during the hearing.
Nevertheless, it is important to observe that the parties were confronted with what I described in my reasons as "all but intractable legislation". This, I think, is a significant matter to take into account in considering the question of costs in a matter such as this. This is not a case where difficult legislation is a relevant but peripheral or incidental matter, but is one where the measure of the appellant's right to compensation is based squarely on the legislation under consideration. In such circumstances and given the limited assistance available from decided cases, it is not surprising that the appellant elected to pursue a range of matters on appeal. I refer particularly to the premium (s.281(4)(c)), the additional amount (s.281(4)(e)) and the issue of Capital Gains Tax, together with Mr Houen's fees (s.281(3)(a)(vi)). To some extent with respect to these matters the appellant raised arguable propositions. Nevertheless, the appellant sought, in my view, to extend the meaning of s.281 MRA to the point that there was a clear attempt to duplicate compensation in some respects.
The three appeals and the cross-appeal were argued together, thus reducing the burden on the respondent that might have arisen from three separate appeals. The resultant economies and efficiencies are noted, however, they were eroded to some extent by the lack of reference to the record in support of particular grounds of appeal. This imposed some small burden on the respondent but was more troublesome to the Court.
The appellant submitted that as regards "ordinary" questions of valuation, such as the increase of compensation to the appellant, the costs should follow the "event"; and that with regards to the arcane points of law; and reference was made here to the Capital Gains Tax issue and the question of a premium under s.281(4)(c) MRA; that each party bear its own costs on those issues.
The respondent submitted that the appellant pay four-fifths of the respondent's costs and the respondent pay one-fifth of the appellant's costs; or more simply, that the appellant pay three-fifths of the respondent's costs.
Having regard to the observations that I have made above, I conclude that the success of the appellant should be taken into account offset, however, by the other various matters that I have outlined, but with full recognition being given to the complex nature of the legislation under which the appellant's right to compensation is assessed. There is justification in my view for an award of partial costs. The result is that I conclude that the appellant should pay 45% of the respondent's costs.
Order
1. The appeal is allowed.
2.The determination of the Warden is varied such that compensation is determined in the amount of $1,068,978.10, which figure includes the $25,000 for "business inconvenience" agreed to by the parties.
3.The amount determined as compensation is to be paid in full not later than 30 days after the grant of the mining lease.
4.The appellant shall pay 45% of the respondent's costs of and incidental to the appeal including reserved costs to be ascertained and fixed by the Taxing Officer of the Supreme Court at Brisbane according to the scale of costs prescribed by law for the time being in respect of proceedings in the Supreme Court and in accordance with the provisions of s.41(9) of the Land Act 1962.
RP SCOTT
MEMBER OF THE LAND COURT
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