Zhang v Davidson (No 2)

[2020] NSWLEC 89

Land and Environment Court

New South Wales

Medium Neutral Citation:

Zhang v Davidson (No 2) [2020] NSWLEC 89

Hearing dates:

27 April 2020

Date of orders:

14 July 2020

Decision date:

14 July 2020

Jurisdiction:

Class 2

Before:

Robson J

Decision:

See orders at [72]

Catchwords:

ENVIRONMENT AND PLANNING — Land and Environment Court — Practice and procedure — Costs — Tree dispute — Whether order for costs is fair and reasonable — Costs of litigant appearing by an agent — No order as to costs

Legislation Cited:

Civil Procedure Act 2005 (NSW) s 98

Land and Environment Court Rules 2007 (NSW) r 3.7

Trees (Disputes Between Neighbours) Act 2006 (NSW) Pt 2A, ss 14D, 14E

Cases Cited:

Arden Anglican School v Hornsby Shire Council [2008] NSWLEC 103; (2008) 158 LGERA 224

Bailey v Gould [2011] NSWLEC 96

Burns v St Clair (No 2) [2015] NSWLEC 115

Cachia v Hanes (1994) 179 CLR 403; [1994] HCA 14

D’Arcy v Campbelltown City Council [2003] NSWLEC 164; (2003) 126 LGERA 401

Dunford v Gosford City Council (No 3) [2015] NSWLEC 96

Fox v Ginsberg (No 3) [2011] NSWLEC 139

Grant v Kiama Municipal Council [2006] NSWLEC 70

Liverpool City Council v Moorebank Recyclers Pty Limited; Benedict Industries Pty Ltd v Minister for Planning (No 4) [2017] NSWLEC 116

McLaren v Lewis (No 2) [2011] NSWLEC 176; (2011) 183 LGERA 344

Steber v Job [2019] NSWLEC 1308

Zhang v Davidson [2020] NSWLEC 1030

Texts Cited:

Land and Environment Court Practice Note – Class 2 Tree Applications

Category:

Costs

Parties:

Jianqiu Zhang (Applicant)
Bruce Norman Davidson (Respondent)

Representation:

Counsel:
G Shapiro, solicitor (Applicant)
R Buttrose, as agent (Respondent)

Solicitors:
Hones Lawyers (Applicant)
R Buttrose, as agent (Respondent)

File Number(s):

2019/00228006

Publication restriction:

Nil

Judgment

1. Bruce Norman Davidson was the successful respondent to an application brought by Jianqiu Zhang, the owner of adjoining premises, pursuant to the Trees (Disputes Between Neighbours) Act 2006 (NSW) (‘Trees Act’) seeking the removal of a hedge growing in the front yard of Mr Davidson’s premises in Vaucluse.

2. Mr Zhang’s application was heard onsite on 21 November 2019 by Acting Commissioner Galway. The Commissioner reserved his judgment at the conclusion of the hearing and, on 10 January 2020, dismissed Mr Zhang’s application: Zhang v Davidson [2020] NSWLEC 1030.

3. Mr Davidson now applies by notice of motion filed 7 February 2020, for an order that costs in the sum of $13,267.50, which he claims were incurred by him in defending the application, be paid by Mr Zhang.

4. The hearing of the notice of motion proceeded before me on 27 April 2020. Although Mr Davidson did not have legal representation throughout the proceedings, Mr Richard Buttrose appeared as his agent, and Mr Gavin Shapiro, solicitor, appeared for Mr Zhang.

5. For the reasons that follow, I consider it appropriate that there be no order for costs in respect of either the substantive proceedings before the Commissioner or in relation to the notice of motion.

Background

6. The background facts are relatively uncontentious. Mr Zhang lodged a Tree Dispute Application on 23 July 2019 which sought either removal or twice-yearly pruning of a hedge on Mr Davidson’s property formed by a row of Leyland cypress (Cupressus × leylandii) (‘trees’) planted close to the common boundary with Mr Davidson’s property. At hearing before the Commissioner, it was submitted on behalf of Mr Zhang that an order was required to prevent a future view loss from the ground floor of Mr Zhang’s dwelling which, as a result of recent renovations, now also has a view from a basement level beneath the ground floor.

7. Considering the matters in s 14E of the Trees Act, and noting that Mr Davidson disputed that the trees “severely obstructed” the view from Mr Zhang’s dwelling, the Commissioner considered that, pursuant to s 14E(2), he was required to determine if the trees forming the hedge were “severely obstructing” a view.

8. Although the Commissioner accepted that there was a severe obstruction of the view from the recently constructed basement level of Mr Zhang’s dwelling, he noted that the view would not have been available before the recent renovations and, further, that the basement level was not a principal living area. As such, the Commissioner reached the following conclusion at [14] in relation to the basement view:

“…despite the view obstruction on the basement level being severe, having considered matters at s 14F I would not make any orders to interfere with the trees on this basis.”

9. Having also found that the view obstruction from the ground-floor living areas (above the basement level) was, at the time of the hearing, not severe, the determinative question before the Commissioner was whether he was able to make orders as requested to prevent the future obstruction of the view from the ground-floor living areas, given his finding that there was an existing severe obstruction caused by those same trees at the basement level below.

10. Relevant to the present application before the Court, the Commissioner considered, but did not accept, an argument made by the legal representative for Mr Zhang, Mr Shapiro, that the Court was able to make orders to prevent the future severe obstruction of a view, including views other than those already severely obstructed.

11. Having considered relevant sections of the Trees Act and s 14D in particular, the Commissioner did not accept the interpretation proffered on behalf of Mr Zhang. The Commissioner instead found that for the Court to have power to make orders in relation to multiple views, the requirements contained within s 14E(2) of the Trees Act must be satisfied for each discrete view. The Commissioner consequently stated at [16]:

“… Therefore, although a view from the basement is severely obstructed by trees in the hedge, that finding does not enable the Court to make orders with the aim of preventing the obstruction of a separate view.”

12. As such, and although there was a significant view obstruction from the ground floor before the completion of the recent renovations and before earlier pruning had been undertaken, given that he did not consider the views from the ground floor (leaving aside the view from the basement) to be severely obstructed at that time by Mr Davidson’s hedge, the Commissioner determined that no order could be made restraining the potential future view loss of the ground floor view and dismissed Mr Zhang’s application.

Evidence

13. In support of his notice of motion seeking costs in the specific sum of $13,267.50, Mr Davidson reads two affidavits of Richard William Buttrose, the agent who appeared at the hearing before the Commissioner and before the Court at the hearing of the motion, affirmed 7 February 2020 and 23 March 2020; and the affidavit of George Palmer, the arboricultural expert retained on behalf of Mr Davidson, affirmed 21 March 2020. Mr Buttrose provided detailed written submissions on behalf of Mr Davidson.

14. In opposition to the motion, Mr Zhang reads two affidavits of Gavin Shapiro, solicitor, sworn 3 March 2020 and 6 April 2020; an affidavit of Tony Moody, the town planner retained on behalf of Mr Zhang, sworn 6 April 2020; and an affidavit of his son, Bin (Bryan) Zhang, affirmed 3 April 2020. Mr Shapiro provided detailed written submissions prepared on behalf of Mr Zhang.

15. The Court has also been directed to evidence that had been before the Commissioner including two arboricultural reports of Catriona Mackenzie dated 16 August and 4 October 2019; an affidavit of Bin (Bryan) Zhang affirmed 23 May 2019; and an expert town planning report prepared by Mr Moody dated 5 November 2019.

16. In his affidavit of 7 February 2020, Mr Buttrose details the history of the conduct of the matter and gives details of ongoing discussions and correspondence with Mr Shapiro, Mr Zhang’s solicitor, in relation to a suggested change of position (from “a future loss of view to one that claimed a past obstruction to the view”) to be adopted by Mr Shapiro in the further conduct of the matter, apparently after Mr Buttrose had prepared written submissions on behalf of Mr Davidson. Mr Buttrose also details Mr Zhang’s failures to comply with Court directions by, for example, serving an expert report of a town planner (Mr Moody) on 7 November 2019, several weeks after the applicant’s evidence was to be filed; and, he also notes that on 19 November 2019, further evidence (being the affidavit of Bin (Bryan) Zhang) was filed two days before the commencement of the hearing. In his affidavit of 23 March 2020, Mr Buttrose responds to matters raised in Mr Shapiro’s affidavit of 3 March 2020.

17. The affidavit of Mr Palmer details a conversation he had in February 2020 (after the hearing before the Commissioner) with Catriona Mackenzie, the aboricultural expert retained for Mr Zhang at the hearing, in which Ms Mackenzie allegedly made comments in relation to Mr Zhang’s poor prospects of success and provided advice she had given to that effect, prior to the hearing.

18. In Mr Shapiro’s affidavits, he responds to the matters raised in Mr Buttrose’s affidavits where he takes issue with a number of his comments as well as his account of the history of the conduct of the matter detailed by Mr Buttrose. In particular, in response to the suggestion that expert material had been provided late, he deposes that the expert report of Ms Mackenzie, which was served on 4 October 2019, was a supplementary report that was provided to correct mistakes in an earlier report of Ms Mackenzie dated 16 August 2019 which had been served on Mr Davidson. Mr Shapiro also takes issue with a number of conversations detailed in Mr Buttrose’s affidavit and explains that the late provision of the expert report of Mr Moody was a response to matters relied upon in the evidence marshalled on behalf of Mr Davidson. Mr Shapiro also responds to various suggestions made by Mr Buttrose which were critical of his conduct as a legal practitioner.

19. The affidavit of Bin (Bryan) Zhang responds to matters contained in Mr Buttrose’s affidavit and states that at no time did he or his father receive advice to the effect that the application had limited prospects of succeeding or that the hedge did not cause a moderate or severe obstruction.

20. The affidavit of Mr Moody responds to the affidavits of Mr Buttrose and Mr Palmer and details his recommendation to Mr Zhang that Ms Mackenzie be retained for the hearing given her arboricultural qualifications and experience, and notes that he had assessed the then current view obstruction and made recommendations that the hedge be pruned to a certain height; he did not have any discussions with Ms Mackenzie in relation to either view obstruction or prospects of success in the proceedings; and he had formed the professional opinion that the matter had good prospects of success.

Submissions

21. Without disrespect to the detailed written and oral submissions made by Mr Buttrose and Mr Shapiro on behalf of both parties, I briefly summarise their respective positions.

22. Mr Buttrose, on behalf of Mr Davidson, submits that the proceedings brought by Mr Zhang lacked reasonable prospects of success such that an order for costs against Mr Zhang would be fair and reasonable in accordance with r 3.7(3)(f) of the Land and Environment Court Rules 2007 (NSW) (‘Court Rules’).

23. In essence, Mr Buttrose contends that, as there was never a relevant severe obstruction to views from Mr Zhang’s property, the case was “hopeless” because s 14E(2)(a)(ii) of the Trees Act requires a court to be satisfied of a severe obstruction before a court can make an order under Pt 2A.

24. Mr Buttrose submits that as relief available under the Trees Act does not encompass a future, yet unrealised, view obstruction, the Court could never have had jurisdiction to hear Mr Zhang’s application and, as such, it had no prospect of success. He also points out that the hedge had been pruned five months prior to the hearing before the Commissioner specifically to maintain Mr Zhang’s views, and notes that evidence before the Commissioner, including an affidavit of Bin (Bryan) Zhang; a survey report; and the expert report of Mr Moody, demonstrated that there had not been a view obstruction from the ground floor since that time.

25. In submitting that Mr Zhang’s case had no prospect of success, Mr Buttrose makes serious allegations describing the conduct of the experts called on behalf of Mr Zhang, as “untruthful”, “misleading” and “dishonestly advising Mr Zhang” (in relation to Mr Moody); and both “untruthful” and “abandon[ing] her duty to the Court as an Expert Witness” (in relation to Ms Mackenzie).

26. Mr Buttrose also made detailed and serious criticisms in relation to the conduct of Mr Shapiro, stating that parts of Mr Shapiro’s affidavit are “intentionally misleading” including reference to “Mr Shapiro’s dishonesty”. In support of these comments, Mr Buttrose directs the Court to detailed aspects of Mr Shapiro’s affidavit filed in support of the motion.

27. Mr Buttrose also submits that it would be fair and reasonable to order costs as Mr Zhang delayed providing information or documents pursuant to r 3.7(3)(b) in that Mr Zhang filed evidence later than a date specified in the Court’s directions for the preparation of the matter for hearing.

28. Mr Buttrose claims that Mr Zhang acted unreasonably in the conduct of the proceedings pursuant to r 3.7(3)(d) as Mr Zhang “changed his position” with respect to the claim that was being made in the proceedings and, similarly to the above, filed his evidence late.

29. Mr Buttrose submits that the Court has discretion to make the orders sought pursuant to s 98 of the Civil Procedure Act 2005 (NSW) (‘Civil Procedure Act’) and that such costs are not limited to the expenses incurred by a litigant in engaging a legal practitioner.

30. In further written submissions dated 27 April 2020, Mr Buttrose contends that the submissions made on behalf of Mr Zhang (in relation to the Court’s ability to order costs in this matter) “…make no sense and are a clear misinterpretation of the law” and makes further submissions in relation to the Court’s power to award costs in circumstances such as those presently before the Court.

31. Mr Buttrose submits that the circumstances exist for the Court to award costs in favour of Mr Davidson, repeating his submission that Mr Shapiro acted “dishonestly” and was “misleading in his affidavit”, including that he made “false and misleading” statements, and that these circumstances warrant a finding to award costs on the basis that the claim pursued on behalf of Mr Zhang was “groundless, without substance and hopeless”.

32. Finally, in addition to the claim articulated in the notice of motion (in the sum of $13,267.50) at par (139) of the submissions prepared by Mr Buttrose, it states that costs “on an indemnity basis in the amount of $4,000 for costs incurred on this motion since 24 March 2020”, are sought.

33. Through Mr Shapiro, Mr Zhang denies the claims made by Mr Davidson and submits that: first, the circumstances of the case are not such that it would be fair and reasonable to make an order for costs; and second, the Court lacks jurisdiction to make the orders sought by Mr Davidson for payment of costs as he did not retain legal representation, such that the motion should be dismissed.

34. Mr Shapiro submits that it would not be fair and reasonable to warrant an order for costs for five reasons:

1. The mere fact that an application was unsuccessful does not dictate an order that costs should follow;

2. Although some evidence was filed late, in the circumstances there was no prejudice to the other party; orders were made in relation to the late filing by consent; and the additional evidence was required to respond to facts and evidence which had emerged during the course of the proceedings;

3. Mr Zhang did not change his case as Mr Davidson claims, nor has Mr Davidson explained how this would found an order for costs in any event;

4. Mr Zhang’s application was not unreasonable in circumstances where the “two findings of mixed merit and fact” which the Commissioner was required to make, are the same as any other Class 2 proceedings under Pt 2A of the Trees Act; and

5. Mr Zhang’s case was not “doomed to fail” as submitted by Mr Davidson.

35. In addition to the above, Mr Shapiro submits that the fees charged by an authorised agent such as Mr Buttrose, who is not a legal representative, in the course of representing a litigant do not constitute “legal costs” or “costs of the proceedings” such that Mr Buttrose’s costs are not recoverable. Mr Shapiro therefore submits that the motion is incompetent as the orders sought are beyond the power of the Court pursuant to s 98 of the Civil Procedure Act and that, if the Court were to award any costs, the Court would only have jurisdiction to award costs for “out of pocket” disbursements incurred by Mr Davidson. Mr Shapiro further submits that Mr Davidson seeks an order in a fixed amount which is a separate matter for costs assessment and not a determination to be made by the Court.

36. Given the above, in submissions, Mr Shapiro indicates that Mr Zhang seeks an order that Mr Davidson pay Mr Zhang’s costs of the notice of motion filed 7 February 2020 on an indemnity basis or, alternatively, on a party-party basis, because the motion seeking costs was incompetent and could not succeed; and, further, that the presumption against awarding costs in Class 2 proceedings does not apply to a notice of motion seeking costs filed after the conclusion of the substantive proceedings.

Consideration

37. The essential issues for consideration are: first, whether the conduct by and on behalf of Mr Zhang in the proceedings warrants an order for costs; and, if so, whether costs in proceedings are recoverable where a litigant is represented by an agent.

The Court’s power to order costs

38. The Court’s power to order costs is derived from s 98(1) of the Civil Procedure Act and subject to the Court Rules.

39. Disputes under the Trees Act are conducted in Class 2 of the Court’s jurisdiction, to which the presumptive rule contained within r 3.7(2) of the Court Rules applies:

“The Court is not to make an order for the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances.”

40. Further, r 3.7(3) of the Court Rules provides a non-exhaustive list of circumstances in which an order for costs may be fair and reasonable:

(3)   Circumstances in which the Court might consider the making of a costs order to be fair and reasonable include (without limitation) the following—

(a)   that the proceedings involve, as a central issue, a question of law, a question of fact or a question of mixed fact and law, and the determination of such question—

(i)   in one way was, or was potentially, determinative of the proceedings, and

(ii)  was preliminary to, or otherwise has not involved, an evaluation of the merits of any application the subject of the proceedings,

(b)   that a party has failed to provide, or has unreasonably delayed in providing, information or documents—

(i)   that are required by law to be provided in relation to any application the subject of the proceedings, or

(ii)  that are necessary to enable a consent authority to gain a proper understanding of, and give proper consideration to, the application,

(c)   that a party has acted unreasonably in circumstances leading up to the commencement of the proceedings,

(d)   that a party has acted unreasonably in the conduct of the proceedings,

(e)   that a party has commenced or defended the proceedings for an improper purpose,

(f)    that a party has commenced or continued a claim in the proceedings, or maintained a defence to the proceedings, where:

(i)   the claim or defence (as appropriate) did not have reasonable prospects of success, or

(ii)  to commence or continue the claim, or to maintain the defence, was otherwise unreasonable.

41. Relevant to the present matter, subrr 3.7(3)(b), (d), (e) and (f) of the Court Rules provide that the delayed provision of documents; unreasonable conduct by a party in the conduct of proceedings; commencement of proceedings for an improper purpose; or maintenance of a defence which was without reasonable prospect of success, may justify an order of costs.

42. Although the six indicia prescribed by r 3.7(3) of the Court Rules may provide some assistance when evaluating whether a costs order is fair and reasonable, the power exercised by the Court is not confined to these matters and is instead in the broadest of terms. I refer to the comments of Biscoe J in Arden Anglican School v Hornsby Shire Council [2008] NSWLEC 103; (2008) 158 LGERA 224 (‘Arden’) at [9]:

“… All rational considerations are relevant to the formulation of that judgment. In the end, the question is whether, in the opinion of the Court, they are of sufficient weight to overcome the presumptive rule. Indicative guidelines for the exercise of the discretion are useful in promoting consistent decisions, but are not entitled to presumptive, let alone determinative, weight. …”

43. The principles applicable to the Court’s exercise of the costs power under r 3.7 of the Court Rules are well-known: Liverpool City Council v Moorebank Recyclers Pty Limited; Benedict Industries Pty Ltd v Minister for Planning (No 4) [2017] NSWLEC 116 at [10]-[14], Dunford v Gosford City Council (No 3) [2015] NSWLEC 96 at [30], Burns v St Clair (No 2) [2015] NSWLEC 115 at [9]-[12], McLaren v Lewis (No 2) [2011] NSWLEC 176; (2011) 183 LGERA 344 (‘McLaren’) at [13]-[17], [21]-[24], Fox v Ginsberg (No 3) [2011] NSWLEC 139 at [9], and earlier, Grant v Kiama Municipal Council [2006] NSWLEC 70 at [15].

44. It is apposite to note that the “no discouragement” principle underlies and provides guidance in the application of r 3.7 of the Court Rules. Put simply, a person generally should not be discouraged from making or defending an application by the prospect of an adverse costs order: Arden at [10].

45. The no discouragement principle is particularly important when considered in the context of applications made pursuant to the Trees Act, as such applications are facilitated by the Court’s Practice Note – Class 2 Tree Applications, which is designed to facilitate the just, quick and cheap resolution of tree disputes through an appropriate and easily accessible procedure.

46. In order to determine whether an order for costs is fair and reasonable in the circumstances, I consider that it is necessary to first have recourse to the Commissioner’s judgment in order to identify whether any concerns or issues were previously raised which would make such a costs order appropriate. However, as I do not consider that the Commissioner’s decision contains any suggestion that a costs order would be fair and reasonable in the circumstances, I consider the evidence now before the Court including material and correspondence to which I have been directed, that may not otherwise have been before the Commissioner.

Reasonable prospects of success

47. I do not consider it would be fair and reasonable to make an order that Mr Zhang pay the whole or part of Mr Davidson’s costs as I do not consider that the application brought by Mr Zhang was without reasonable prospects of success or that he, or those acting for him, conducted themselves in a manner that would displace the presumption that there be no order for costs.

48. While it is correct to say that the Court does not have power to make orders in regard to tree disputes which concern a view loss that is yet to materialise, it is clear from the judgment of the Commissioner that the hedge did, in fact, cause a severe obstruction, albeit only in respect to the view from the basement level at the time of the hearing. While the position as to whether an order can be given in anticipation of a significant obstruction occurring in the future, may be a matter of some debate, the Commissioner’s determination in this regard is not under challenge in this motion.

49. While I accept that the Commissioner found that there was no severe obstruction to the ground floor view (being one floor above the basement) and that this circumstance would otherwise not trigger the Court’s power to make an order, the submission advanced by Mr Shapiro at the hearing before the Commissioner, as I understand it, was that as the Court’s jurisdiction had been triggered by the severe obstruction to the basement view, its jurisdiction to consider the impacts to both the basement view and ground floor view by those trees had been enlivened. Mr Shapiro’s submissions were additionally founded on the premise of there being a “recently severe” view obstruction in accordance with the recent authority of Steber v Job [2019] NSWLEC 1308 (‘Steber v Job’).

50. In simple terms, and again noting that the decision of the Commissioner is not under review in this motion, the argument made by Mr Shapiro on behalf of Mr Zhang appears to be that, as a jurisdictional matter, in accordance with s 14D of the Trees Act, the Court may make an order that would “prevent” a severe obstruction in circumstances where the hedge had existed and had obstructed views at a time in the past. In these circumstances and noting the word “prevent” may have some work to do, I do not consider that the argument was so devoid of plausibility or prospects of success such to invoke the circumstances in r 3.7(3)(c), (d) or (f) of the Court Rules.

51. It is clear that the question regarding the interpretation of s 14D of the Trees Act was relatively novel and that there was little guidance in the caselaw in relation to the interpretation of a “recent” view obstruction as introduced by the case of Steber v Job. As the arguments made on behalf of Mr Zhang by Mr Shapiro (although unsuccessful) undoubtedly had some basis and merit, I do not consider that Mr Zhang’s position was therefore “hopeless” such that an order for costs would be fair and reasonable in the circumstances.

52. In passing, I note that the relief sought in Mr Zhang’s claim had the hallmark of a quia timet injunction, in the sense that Mr Zhang is seeking an order to prevent future conduct, that is either threatened or imminent, but has not yet occurred.

Late evidence

53. I do not consider that an order for costs is fair and reasonable by virtue of either the late filing of evidence or conduct on Mr Zhang’s behalf throughout the proceedings. While I accept the submission of Mr Shapiro that the question of whether the late production of evidence is “fair and reasonable” is usually a matter to be dealt with by the Court in deciding whether to admit the evidence, I also accept that the filing of late evidence may justify an order for costs in circumstances where additional costs are required to be spent as a consequence of that late evidence. However, even accepting the failure to adhere to the earlier directions for the filing of material; given that orders in relation to the filing of late evidence were made by consent on 12 November 2019; and that, apart from Mr Buttrose’s written submissions having been earlier prepared – although there was no direction given for the filing of submissions; there is no evidence before the Court of any material detriment caused to Mr Davidson by virtue of the late filing, I therefore do not consider that this conduct alone, or in combination with other matters, demonstrates that an order for costs would be fair and reasonable in the circumstances.

54. Further, the evidence of Mr Shapiro was that the further evidence marshalled on behalf of Mr Zhang responded to issues raised in the evidence marshalled on behalf of Mr Davidson, including material that was “highly prejudicial as to the professional integrity of Ms Catriona Mackenzie…”.

55. While I accept that the late provision of evidence in any litigation is unfortunate, I do not accept the submission made by Mr Buttrose (and there is no evidence to substantiate the suggestion) either that Mr Zhang or his representatives sought to “flood [Mr Davidson] with materials with little or no notice”, or that Mr Zhang sought “… to intentionally delay the provision of documents by contemptuously ignoring the Directions of the Court”.

Mr Zhang’s conduct during proceedings

56. I do not repeat the matters I have noted above. While I accept that the Commissioner properly dealt with all the matters based upon the evidence and assumptions before him, and that there may have been some inconvenience caused by the late provision of certain material, in the circumstances where there was at least a proffered reason for the late provision of material on behalf of Mr Zhang, and where that material was in fact considered and responded to during the hearing before the Commissioner, and was the subject of further evidence and consideration by the parties’ representatives and the Commissioner, I do not consider that such conduct, in the circumstances of the intercourse between the parties, to be unreasonable.

57. On the evidence before the Court, I do not accept the submission made by Mr Buttrose that any of Mr Shapiro’s statements in his sworn affidavit were “false and misleading”. To this end, throughout his extensive written and oral submissions, Mr Buttrose has repeatedly used expressions such as “false and misleading”, “intentionally misleading”, and has referred to Mr Shapiro’s “dishonesty” in a manner which I consider is both inappropriate and without any proper foundation.

58. While accepting that Mr Buttrose is appearing as agent and does not have legal qualifications, the Court should neither accept nor tolerate submissions that seek to attack the integrity of legal practitioners who give sworn evidence and qualified expert witnesses, being Mr Moody and Ms Mackenzie, both of whom gave their evidence before the Commissioner subject to the “Expert witness code of conduct” pursuant to Sch 7 of the Uniform Civil Procedure Rules 2005 (NSW) (‘UCPR’). Mr Buttrose has described aspects of Mr Moody’s evidence as “…either untruthful … or he misled Mr Zhang”; and, that he “dishonestly advised…”. In relation to Ms Mackenzie, Mr Buttrose in his affidavit stated, “Ms Mackenzie’s professional integrity remains in tatters”; that she “…was untruthful … abandoned her duty as an expert”; and, that she “dishonestly stated … [matters]”.

59. Thus, although I accept that Mr Buttrose is not legally qualified, the nature and frequency of accusations made against experienced professionals involved in the proceedings was inappropriate in circumstances where the accusations made were both serious and had little foundation. That being said, I have not given any weight to these remarks nor have I taken them into account in determining the legal issues presently before the Court.

60. Again, in circumstances where serious allegations of misconduct are made in a costs application regarding the conduct of a substantive proceeding before a Commissioner in Class 2 of the Court’s jurisdiction, and even accepting that the manner in which the litigation was conducted on behalf of Mr Davidson may have been the subject of some legitimate criticism, it certainly does not warrant or invite the extravagant language used in Mr Buttrose’s submissions.

61. Suffice it to say, I do not consider that Mr Zhang (and those who were acting and/or advising on his behalf) acted unreasonably in the circumstances leading up to the commencement of the proceedings or in the conduct of the hearing, nor were proceedings commenced or continued where the application did not have reasonable prospects of success; where such commencement or continuation was otherwise unreasonable; or that the commencement was for an “improper purpose”.

Costs incurred by litigants appearing by an agent

62. Although I do not consider that an order for costs is fair and reasonable in the circumstances, I would nonetheless have not granted orders in the nature sought by Mr Davidson. My reasons follow.

63. An order for costs made pursuant to the Court Rules is confined to money paid or liabilities incurred in retaining legal representation and, as such, does not include compensation for time spent preparing and conducting a case by a litigant who is not a lawyer: Cachia v Hanes (1994) 179 CLR 403; [1994] HCA 14 at 409-410, 414. This principle has been consistently applied by this Court in respect to litigants in person: Bailey v Gould [2011] NSWLEC 96 at [4], Thomas v Holmes (No 3) [2017] NSWLEC 156 at [55]-[56].

64. A litigant who appears by an agent who is not legally qualified may be equated to a litigant in person in Class 2 of the Court’s jurisdiction for the purposes of determining the costs that may be recoverable in proceedings. I accept the analysis of Pain J in D’Arcy v Campbelltown City Council [2003] NSWLEC 164; (2003) 126 LGERA 401 at [14]-[15], where her Honour stated (albeit with reference to the former s 69 of the Land and Environment Court Act 1979 (NSW)):

“… The inference is clear that the only costs that it is appropriate for this Court to order are legal costs appropriately incurred in Court proceedings. That means that a non legally qualified agent’s costs would not be covered by s 69. I am strengthened in this view by a decision of Bignold J in Megna v Drummoyne Municipal Council (Bignold J, NSWLEC, 26 May 1988, unreported) where his Honour held that s 63 does not operate so as to extend, by necessary implication, the costs power under s 69 of the Court Act to professional legal costs for work done by representatives who are not legally qualified. A further decision of Bignold J, Harvey v Burwood Municipal Council (Bignold J, NSWLEC, 7 May 1993, unreported) confirms the earlier decision in Megna.

[15] The lack of other cases in this area (the parties themselves have not handed up any case exactly on point) is probably due to the fact that few if any agents have sought their costs in the circumstances before me. This is not surprising given the decision of Bignold J in Megna in 1988. Accordingly, the Applicants’ agent cannot get his costs.”

65. Although I note that her Honour’s decision was with respect to a Class 1 proceeding and now superseded legislation, I consider the principles to be nonetheless applicable and appropriate in the present matter.

66. Nonetheless, a litigant in person may be reimbursed for out of pocket costs incurred in and for the purposes of litigating the proceedings in some circumstances: McLaren at [17].

67. As such, even if I had found that a costs order was fair and reasonable in the circumstances, the Court would have some difficulty in making an order for disbursement costs in circumstances where the Court does not have before it any evidence of either how the costs claimed by Mr Davidson in the precise sum of $13,267.50 (or the $4,000 blandly stated in the submissions) have been incurred, except to claim that Mr Davidson “was required to expend significant costs preparing these further submissions”, as stated by Mr Buttrose. The evidence of Mr Shapiro was that Mr Buttrose had previously prepared written submissions six weeks before the hearing when there was no direction requiring written submissions. Further, the Court has not received evidence indicating the extent to which the costs sought represent compensation for the time spent preparing and conducting the case by the agent; or the extent to which these sums represent moneys paid or liabilities incurred which may, in different circumstances, be validly sought. At most, Mr Davidson would likely only be entitled to costs in relation to filing fees and the arboricultural report as, absent any evidence suggesting otherwise, these are the only apparent disbursements that have been incurred by Mr Davidson in conducting the proceedings. As noted above, I do not consider that such an order would be fair and reasonable in any event.

Costs of the notice of motion

68. In anticipation that the notice of motion would be dismissed, Mr Zhang seeks his costs in relation to the motion and points to correspondence between his solicitor and Mr Davidson (and Mr Buttrose) on 12 February 2020 in which Mr Shapiro suggested that the motion, for reasons stated, was misconceived and “most certainly would be dismissed”.

69. Although Mr Davidson was unsuccessful in his costs application, and despite my criticisms in relation to some aspects of the conduct of Mr Buttrose, I do not consider that it would be fair and reasonable for Mr Zhang to pay Mr Davidson’s costs. Although I hold a concern in relation to the manner and nature of certain submissions that were made by Mr Buttrose, I do not consider that Mr Zhang ought to be penalised for the conduct of Mr Buttrose, appearing as an non-legally qualified agent, for what was otherwise an application which, although not ultimately successful, was not without some merit and may not have been so “certainly” dismissed as suggested by Mr Shapiro.

70. Although there may be different approaches, I consider that r 3.7 of the Court Rules as it is drafted, continues to apply to the motion seeking costs which, like the substantive proceedings before the Commissioner, fall within Class 2 of the Court’s jurisdiction. Even if that were not the case and r 42.1 of the UCPR was enlivened, taking into account all the circumstances, I would not have found that it was appropriate for costs of the motion to follow the event.

Conclusion

71. The notice of motion filed 7 February 2020 is dismissed and there is to be no order as to costs either of the proceedings before the Commissioner or this notice of motion.

Orders

72. The orders of the Court are:

1. Notice of Motion filed 7 February 2020 is dismissed.

2. Each party to bear their own costs of the Notice of Motion.

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Decision last updated: 15 July 2020