Land and Environment Court of New South Wales CITATION : Millerview Constructions Pty Ltd v Eurobodalla Shire Council [2000] NSWLEC 196 APPLICANT: Millerview Constructions Pty Ltd PARTIES : RESPONDENT: Eurobodalla Shire Council FILE NUMBER(S) : 10269 of 1998; 10730 of 1998 CORAM: Talbot J KEY ISSUES: Costs :- notice of discontinuance filed - whether exceptional circumstances LEGISLATION CITED: Land and Environment Court Act 1979 Land and Environment Court Rules 1996 Pt 11 r 5 Kentgreen Dural Pty Ltd v Hornsby Shire Council (1999) 103 LGERA 219; CASES CITED: Menangle Sand & Soil Pty Ltd v Wingecarribee Shire Council and Ors (2000) 108 LGERA 209; Tabaquero v Campbelltown City Council [2000] NSWLEC 68 DATES OF HEARING: 25/08/2000 DATE OF JUDGMENT: 08/31/2000 APPLICANT: Mr P R Clay (Barrister) SOLICITORS: Selby Anderson LEGAL REPRESENTATIVES: RESPONDENT: Mr A Bradbury (Solicitor) SOLICITORS: Minter Ellison JUDGMENT: IN THE LAND AND Matter Nos. 10269 of 1998 ENVIRONMENT COURT And: 10730 of 1998 OF NEW SOUTH WALES Coram: Talbot J Decision Date: 31 August, 2000 Millerview Constructions Pty Ltd Applicant v Eurobodalla Shire Council Respondent REASONS FOR JUDGMENT 1. On 31 May 2000 these proceedings were discontinued when the applicant filed a Notice of Discontinuance. The respondent council did not consent to the discontinuance. 2. On 31 January 2000 the Court had dismissed an appeal pursuant to s 56A of the Land and Environment Court Act 1979 ("the Court Act") against a decision by Commissioner Watts not to disqualify himself from further hearing the matter. 3. On 8 June 2000 the respondent council filed a notice of motion seeking an order that the applicant pay the respondent's costs of the proceedings consequent upon the filing of the Notice of Discontinuance. 4. At the hearing of the respondent's notice of motion on 25 August 2000 the applicant filed a separate notice of motion seeking an order that the respondent pay the applicant's costs thrown away for a hearing on 23 February 1999 before Commissioner Hoffman. 5. The applicant has conceded that the respondent is entitled to the benefit of an order that the applicant pay its costs of the appeal against the decision by Commissioner Watts. 6. The grounds for appeal against the decision of Commissioner Watts arose as a consequence of what occurred at an initial hearing before him on 21 May 1999 when the parties appeared to invite the Court to make consent orders allowing the appeal and granting consent to the applicant's development application. After discussion, Commissioner Watts adjourned the hearing principally to allow the council to consider making amendments to a Development Control Plan ("the DCP") to facilitate the making of the consent orders. 7. When the matter came before Commissioner Watts again on 1 October 1999 the council informed the Court that it had resolved not to amend the DCP and further, to oppose the grant of a development consent notwithstanding its original agreement to consent orders. It was at that time the applicant made the application for the Commissioner to disqualify himself from further hearing the matter on the grounds of apprehended bias and pre-judgment. 8. It is appropriate to illustrate the history of the matters by the following short chronology:- 20 April 1998 Proceedings No 10269 of 1998 were commenced seeking development consent for a two lot subdivision. 19 June 1998 A statement of issues was prepared by the respondent. 22 June 1998 Stood over to 21 September at the applicant's request. 21 September 1998 Further adjournment at applicant's request. 22 October 1998 Proceedings No 10730 of 1998 were commenced seeking development consent for a two lot subdivision and erection of a building. 8 January 1999 An amended statement of issues in matter No 10269 of 1998 was prepared by the respondent. A statement of issues in matter No 10730 of 1998 was prepared by the respondent. 11 January 1999 Matters were listed for hearing on 23, 24, 25 February 1999. 8 February 1999 Statements of evidence were filed by council including evidence of the presence of endangered species. 9 February 1999 Hearing confirmed by letter from the Registrar to the parties 16 February 1999 A statement of evidence was filed by the applicant without reference to the presence of endangered species. 17 February 1999 A supplementary statement of evidence relating to the presence of threatened species was filed by the council. 23 February 1999 Hearing adjourned by Commissioner Hoffman at the request of the applicant to enable it to deal with the issue of threatened species and for the council to exhibit the application. 12 April 1999 Set down for hearing 18-21 May 1999. 5 May 1999 Further statements of evidence were filed by the applicant. 7 May 1999 Further statement of evidence was filed by the applicant. 14 May 1999 Council advised the applicant it planned to support the proposed development subject to conditions. May 1999 Hearing set down for 18-21 May 1999 was cancelled by the Court without reference to the applicant. 21 May 1999 Commissioner Watts was invited by the parties to make consent orders. 15 June 1999 Council resolved not to amend the DCP and to withdraw its support for the proposed development. 21 June 1999 The applicant was advised of the council's decision of 15 June 1999. 25/29 June 1999 Callovers not attended by applicant. 2 July 1999 Stood over to next country telephone callover. 21 August 1999 Further development application was lodged by the applicant for subdivision and house construction. 9. Then followed the interlocutory steps leading up to the rejection of arguments by Commissioner Watts on 1 October 1999, which resulted in the appeal pursuant to s 56A of the Court Act. 10. After judgment in the s 56A appeal on 1 February 2000 the matter was listed for callover on three occasions and adjourned to take account of the pending determination of the new development application, which was ultimately determined by refusal of consent on 26 April 2000. 11. The parties have requested the Court to reserve the question of costs in respect of the application for adjournment on 23 February 1999 and costs thrown away by the adjournment of the hearing pending the availability of a copy of the transcript for 23 February 1999. Both parties have been given leave to make further written submissions in respect of that issue within 7 days of the receipt of the transcript. 12. Perusal of the transcript of the proceedings before Commissioner Watts on 21 May 1999 leaves the Court in no doubt that the council unreservedly supported the grant of a development consent subject to conditions. It was only following discussion with Commissioner Watts, and in order to satisfy his concerns about granting a consent totally inconsistent with the prohibitive provisions of the DCP, that the matter was adjourned to enable the council to consider its position. 13. Mr Bradbury explained that the council's conciliatory attitude, as opposed to its earlier outright rejection of the application, was brought about by the production of engineering evidence in respect of the proposed treatment of the site which satisfied the council that the development could proceed notwithstanding its location in a zone identified by the DCP as one where no development could take place. 14. The Court accepts the submission made by Mr Clay on behalf of the applicant that there was no suggestion by the council before Commissioner Watts on 21 May 1999 that it would do anything during the adjournment other than consider amending the DCP so that the subject site would be taken out of the prohibited area. 15. The council relies on what was said by Lloyd J in Menangle Sand & Soil Pty Ltd v Wingecarribee Shire Council and Ors (2000) 108 LGERA 209 at 213 for a summary of the relevant principles to be applied where Pt 11 r 5 of the Land and Environment Court Rules 1996 ("the LEC Rules") and para 10 of the Land and Environment Court Practice Direction 1993 apply:- (a) in planning and building appeals it is first necessary to look for some exceptional circumstance so as to found an order for costs. This is a direct consequence of the Practice Direction to which I have referred; (b) ordinarily, the filing of a notice of discontinuance without the consent of the other party to the litigation will satisfy the exceptional circumstance test. This is because the discontinuance usually represents an abandonment of the applicant's claim, so that costs incurred by the other party are necessarily wasted or thrown away; (c) a relevant consideration in every case is whether the discontinuance was reasonable conduct on a part of the discontinuing party in the circumstances of the case, such as to negate the ordinary costs consequences of a discontinuance of the proceedings. Such conduct may be based on some action by the other party to the litigation or some supervening event beyond the parties' control. 16. The council also refers to the similar approach taken by Bignold J in Kentgreen Dural Pty Ltd v Hornsby Shire Council (1999) 103 LGERA 219 and Tabaquero v Campbelltown City Council [2000] NSWLEC 68. 17. Such an approach with respect is the right one and I adopt it for present purposes. 18. Mr Bradbury contends that the reasoning applies with even greater force in this case where the proceedings were discontinued by the applicant while the matters were part heard before Commissioner Watts. 19. It might be argued that prima facie the applicant was not diligent in pursuing the appeal, for example, by failing to address issues in statements of evidence early in the proceedings and also failing to appear at several callovers. 20. On the other hand, the applicant would have been justified in believing that it had reached an accommodation by way of settlement with the council so far as the issues in contention were concerned when Commissioner Watts was asked to make consent orders on 21 May 1999. 21. The applicant was reasonably entitled to be apprehensive about the prospects of success when the new development application was refused by council, but more particularly, in circumstances where the council had resolved not to amend the DCP and to withdraw its support for the making of consent orders. 22. The latter decision by council would have justifiably generated a concern that while the prohibition remained in the DCP the Court would be unlikely to be sympathetic to the applicant's case in the face of strident council opposition. 23. The Court is satisfied that the discontinuance by the applicant was reasonable in the circumstances of the case. 24. Accordingly, the applicant is entitled to the benefit of the exercise of the Court's discretion under Pt 11 r 5 in order to displace the ordinary presumption identified by Lloyd J that an order for costs will usually be made against a party who discontinues without the consent of the other party. 25. Furthermore, for the same reason, after having regard to the whole of the circumstances and the history of the matter, I am not satisfied that there are any exceptional circumstances which can be attributed to the applicant for the purposes of para 10 of Practice Direction 1993. 26. The costs of preparing for a hearing on the merits have not necessarily been wasted or thrown away by virtue of the applicant's discontinuance of the proceedings but rather the discontinuance of the proceedings was a direct consequence of the reversal of the council's attitude to the grant of development consent. The result is not therefore caused by any exceptional conduct on the part of the applicant. 27. It is appropriate that there be no order as to costs except in so far as costs are reserved as abovementioned and an order by consent that the applicant pay the respondent's costs of the appeal pursuant to s 56A. 28. Orders can be made accordingly. Orders 29. The formal orders of the Court are:- 1. Costs of hearing 23 February 1999 and costs thrown away by reason of adjournment granted on that day reserved. 2. By consent the applicant pay the respondent's costs of the appeal pursuant to s 56A of the Court Act. 3. Subject to orders 1 and 2, no order as to costs. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.