Land and Environment Court of New South Wales CITATION : Prestige Building Services v Coffs Harbour City Council and ors [2005] NSWLEC 707 APPLICANT Prestige Building Services Pty Ltd FIRST RESPONDENT PARTIES : Coffs Harbour City Council SECOND RESPONDENT Department of Infrastructure, Planning and Natural Resources FILE NUMBER(S) : 10746 of 2004 CORAM: Tuor C KEY ISSUES: Costs :- Class 1 proceedings LEGISLATION CITED: Land and Environment Court Rules (Amendment No 8) 2003 Prestige Building Services Pty Ltd v Coffs Harbour City Council NSWLEC 435; Stockland Development Pty Limited v Manly Council (2004) NSWLEC 472; CASES CITED: Aldi Foods Pty Ltd v Holroyd City Council [2005] NSWLEC 338 ; Zhang v Canterbury City Council (2001) 115 LGERA 373 DATES OF HEARING: Written submissions DATE OF JUDGMENT: 12/13/2005 APPLICANT Mr P Mc Ewen SC SOLICITORS Colin Biggers & Paisley LEGAL REPRESENTATIVES: RESPONDENT Mr J Mulder, solicitor SOLICITORS MBT Lawyers JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES Tuor C 13 December 2005 10746 of 2004 Prestige Building Services Pty Ltd (Applicant) v Coffs Harbour City Council (First Respondent) and Department of Infrastructure, Planning and Natural Resources (Second Respondent) (No. 2) JUDGEMENT 1 COMMISSIONER: This is an application for costs by the First Respondent, Coffs Harbour City Council (the council) in relation to an appeal (Prestige Building Services Pty Ltd v Coffs Harbour City Council NSWLEC 435) against the deemed refusal of a development application (1474 /04) to demolish the existing motel on the site and construct a multi unit housing development with two basement car parking levels at 5-9 Boultwood Street, Coffs Harbour (the site). The appeal was heard on 02 and 03 May 2005. 2 Orders dismissing the appeal were made on 10 August 2005, including an order that costs were reserved. 3 Council filed written submissions on 18 August 2005. These sought that that the applicant should pay the council's costs for the Class 1 appeal. 4 The applicant responded with written submissions on 25 August 2005. These sought the council's application for costs be dismissed and that a limited order for costs should be made in favour of the applicant for the costs of council's Notice of Motion of 6 December 2004 and the applicant's Notice of Motion of 27 April 2005. The applicant's submission included a chronology of actions after the appeal was lodged on 25 June 2004. In the absence of any contrary evidence from the council, I have accepted that this is an accurate chronology of the dates and actions, but not the conclusions on costs. 5 Council made a further submission on 1 September 2005 that disputed the matters in the applicant's submission but this was not supported by further information. 6 The Second Respondent, Department of Infrastructure, Planning and Natural Resources (DIPNR) made a submitting appearance and has not sought costs. Although I note that the Court ordered that each party should pay a third of the costs of the Court appointed town planning expert, Mr O'Connor. The basis for an order for costs 7 Prior to 2 February 2004, the practice of the Court was to award costs only where there were exceptional circumstances. From this date, the Land and Environment Court Rules (Amendment No 8) 2003 (the Rules) came into effect and amended the basis for costs in Class 1 cases. The relevant provision of Pt 16 of the Rules now reads: (2) No order for the payment of costs will be made in proceedings to which this Rule applies unless the Court considers that the making of a costs order is, in the circumstances of the particular case, fair and reasonable. 8 This change to the Rules was accompanied by an amendment to the Land and Environment Court Practice Direction 1993 that relevantly reads: 10. Where an application for costs is made in proceedings that have been heard and determined by one or more Commissioners the application shall be made, to that Commissioner or those Commissioner's (as the case may be). Where the Commissioner or Commissioners are of the opinion that a costs order should be made, the parties shall be informed of that decision and the reasons for it and shall be given the opportunity to make submissions to the Chief Judge on the question of whether he should give concurrence to the proposed costs order. 9 In this case, the council has asked to Court to invoke the provisions of Pt 16 of the Rules. The council's case - Class 1 appeal 10 The council submits that an order for costs of the class 1 appeal is justified for two main reasons. Firstly, a significant issue in the proceedings was the height of the proposed development. The council has consistently advised the applicant that a six-storey building was not appropriate for the site as it was in excess of the four-storey height limit contained in the Park Beach Development Control Plan. The discussions on this issue with the applicant commenced prior to the determination of the development application and the approach was maintained throughout the council's consideration of the development application and the appeal. Notwithstanding this advice the applicant pursued the six-storey development. The unsuitability of a six-storey building was ultimately supported by Court. 11 The unsuitability of a six-storey building was also supported by Mr O'Connor on the basis of the non-compliance with the Park Beach Development Control Plan and the inconsistency with the desired future character of the area. 12 The council further submits that considering the comments in Stockland Development Pty Limited v Manly Council (2004) NSWLEC 472 and the fact that the Park Beach Development Control Plan has only recently been implemented after extensive community consultation, a six-storey building was clearly inappropriate in this location. 13 If the applicant had given sufficient and proper regard to the controls within the Park Beach Development Control Plan and the advice given to it by the council, the costs and expenses associated with these proceedings would not have incurred by the council. 14 Secondly, Mr O'Connor also raised further issues that led to the preparation of amended plans. These amended plans required renotification and readvertising, the concurrence of the Director of the Department of Infrastructure Planning and Natural Resources and a further report from Mr O'Connor thereby incurring further costs by the council. 15 The amended plans reduced the height of the building but did not address Mr O'Conner and council's issues in relation to the compliance of the proposal with the Park Beach Development Control Plan. Council by letter of 10 February 2005 indicated that assessment of the amended application would incur further costs, particularly the need for Mr O'Connor to prepare a further report on the amended application, which did not address his concerns. Council proposed that the applicant submit further amended plans to address these issues and that it would be seeking costs in the event that the appeal was unsuccessful. The applicant's case – Class 1 appeal 16 The applicant submits that an order for costs is not justified. The Park Beach Development Control Plan was drafted in such a manner that it created ambiguity between its stated aims and objectives and the numerical requirements. The Park Beach Development Control Plan specifically provides at Part 1, p 2 that an application may depart from the specific controls if it can be demonstrated that an alternative will meet the strategy objectives. It is submitted that the objectives are put in the widest and vaguest terms, specifically: + to provide a diverse mix of accommodation, building types and styles, + to re-establish the area as a vibrant tourist attraction/destination, + to encourage development which ensures no visual intrusion into the beach areas… 17 The desired future character of the Park Beach area is described as: "… a vibrant, colourful attractive place for tourist and permanent residents. The focus should be on family-oriented activities providing links between these activities and beach/reserve". 18 It is submitted that the lack of the controls and the specific ability to avoid strict compliance in certain circumstances permitted, and to some degree encouraged the very type of development proposed by the applicant. It was accepted by the Court that the two-storeys that exceeded the numerical height limit had no adverse amenity impacts to the adjoining properties. It was also accepted by the experts that the proposed development was acceptable in overall design and architectural treatment. 19 Overall, the applicant submits that while the appeal was unsuccessful, the application was not so lacking in merit that it was unreasonably arguable. 20 Further, the applicant submits that it was not unreasonable for it not to adopt all of Mr O'Connor's recommendations in preparing amended plans. The applicant refers to the comments of Talbot J in Aldi Foods Pty Ltd v Holroyd City Council [2005] NSWLEC 338 to support the proposition that neither the applicant nor the Court is bound to accept the recommendations of Mr O'Connor and that the preparation of amended plans is not of itself a reason for costs to be awarded. Particularly as the council did not object to the filing of the amended plans nor file a Notice of Motion in relation to costs thrown away. Findings - Class 1 Appeal 21 On the first matter, the role of a DCP is set out in some detail by McClellan CJ in Stockland Development Pty Ltd v Manly Council [2004] NSWLEC 472. The emphasis to be given to a DCP is addressed in Zhang v Canterbury City Council (2001) 115 LGERA 373. Spigelman CJ, at par 75, raises three important propositions. First, and although the Court has a wide-ranging discretion, the discretion is not unfettered. Secondly the provisions of a DCP are to be considered as a fundamental element in, or a focal point to, the decision-making process particularly, if there are no issues relating to compliance with a local environmental plan. Thirdly, a provision of the DCP directly pertinent to the application is entitled to significant weight in the decision-making process but it is not in itself determinative. 22 It cannot, and was not disputed by the parties, that the Park Beach Development Control Plan is an important consideration in the determination of the application based on the findings in Stockland Development and Zhang however it must be clear in what it seeks to achieve, particularly when some emphasis is placed on a performance or objective based assessment. 23 The Park Beach Development Control Plan clearly contemplates departures from the numerical controls. In this case, I am not convinced that the proposed six-storey building was not a proposition that could not be contemplated under the objective based assessment provisions. Even though an assessment of a development application by way of objective based controls is more difficult than an assessment against numerical requirements, I accept the applicant's submission that there is a level of ambiguity and lack of sphericity between the objectives and the numerical standards. In my view, this heightens the potential for different interpretations. This was a matter that I addressed in the consideration of the merit appeal (see par 40). 24 The council's submission that the consistent advice by its staff of the unsuitability of the six-storey development is a matter that should be given little weight in these proceedings because of the objective based concessions provided in the Park Beach Development Control Plan. Similarly, the submission that Mr O'Connor opposed the six-storey building should also be given little weight. The Court is under no obligation to accept the evidence of any Court appointed experts. 25 For these reasons I find that is not fair and reasonable to make an order for costs on this particular matter. 26 On the second matter raised by the council, I accept that it is fair and reasonable that an order for costs be made in the council's favour for the costs associated with the amended plans. These costs are directly related to the decision of the applicant to address some aspects of the proposal identified by Mr O'Connor through amended plans. His fundamental concern relating to the height of the proposal was not fully addressed in the amended plans, which is the applicant's prerogative, but this remained the determinative issue in the case. 27 Council did not formally object to the lodgement of the amended plans nor seek costs at the time the plans were filed. However, Council's letter of 10 February 2005 indicated that it did not support the amended plans, as they did not address its concerns or those of Mr O'Connor. Council noted that considerable extra expense would be expended for Mr O'Connor to reassess these plans and that it would be seeking costs. While this does not necessarily entitle the council to costs it is an indication that it did not support the expenditure of further costs to assess amended plans that did not address all the council's or Mr O'Connor's concerns. While these plans limited the issues in the case they did not resolve the fundamental issue that had already been assessed once by Mr O'Connor. I do not consider the amended plans a "consequence of an evolutionary process" (Aldi Foods, par 14) but more of an attempt to address issues identified by Mr O'Connor. Consequently, it is fair and reasonable for the applicant to pay the legal costs associated with the further assessment of the plans. 28 The costs should be as agreed or assessed. The costs are those incurred by the First Respondent for Mr O'Connor's assessment and further report on the amended plans served on 8 December 2004 and any associated legal costs, but not administration costs. The Notice of Motion by McClellan CJ on 6 December 2004 29 The council's Notice of Motion sought orders or declarations on a point of law relating to the advertising requirements under cl 51(4) of North Coast Regional Environmental Plan, which had been raised by Mr O'Connor. 30 The parties did not agree on the interpretation of cl 51(4) and each party made submissions at the mention. McClellan CJ did not determine the point of law but made orders that the necessary advertising and notification of the application be carried out. His Honour also ordered that the hearing dates be vacated and that costs be reserved. 31 On the same day the Applicant informed council of its intention to file amended plans that addressed the issues raised by Mr O'Connor. The amended plans were served on 8 December 2004 and subsequently advertised. The procedural correctness of the advertising was not raised as an issue in the proceedings. Findings 32 While the Council brought the Notice of Motion, both parties agreed it was a point of law and made submissions. McClellen CJ did not determine the point of law. The amended application was subsequently readvertised. The question of whether the original application was correctly advertised was irrelevant to the proceedings and no issue was raised as to the readvertising of the amended application. I find that each party should pay its own costs. The hearing of a Notice of Motion by Talbot J on 27 April 2005 33 The applicant's Notice of Motion sought declarations that the consent granted by the council was invalid and that consequently leave be granted to amend the Class 1 appeal to be against a deemed refusal rather than a refusal. 34 The applicant informed Council on more than one occasion that its determination of the application was invalid as it had been dealt with under delegation that was inconsistent with its policy and that the Class 1 appeal should be amended to reflect this. 35 Council responded on a number of occasions by stating that the application was validly determined and that it did not consent to the amendment. The applicant filed the Notice of Motion on 20 April 2005. By letter dated 22 April 2005, council consented to the amendments to the appeal. By letter dated 26 April 2005, the applicant, by consent, sought that the hearing of the Notice of Motion on 27 April 2005 be vacated. Talbot J dismissed the Notice of Motion on 27 April 2005 with costs reserved. 36 During the hearing I granted leave to the applicant's request that the class 1 appeal be amended to be against a deemed refusal. The council did not oppose this action. Findings 37 The applicant's Notice of Motion was necessitated by the council's initial refusal to amend the class 1 appeal that it later consented to. While the need for this matter to be determined prior to the hearing is questioned, it is not unreasonable for an applicant to seek to have its appeal properly constituted. The initial refusal of council to amend the appeal, which is essentially a minor procedural mater, and its subsequent consent to such an amendment are not fair and reasonable and I find that the council should pay the applicant's costs of the Notice of Motion. The applicant has submitted that its costs are $2,144 for its solicitors and $2,600 for Senior Counsel, being the sum of $4744. Costs submissions 38 As neither party was successful in all the matters raised in the costs application it is not appropriate for any order for costs to be made for the submissions on costs. 39 In accordance with Land and Environment Court Practice Direction 1993, the parties are informed of the Court's findings on the application for costs and are given the opportunity to make submissions to the Chief Judge within 14 days from the date of publication of these findings on whether he should give concurrence to the proposed costs order. Findings 40 Subject to the concurrence of the Chief Judge, I order that: 1. The Applicant pay the First Respondent's costs for the amended plans served on 8 December 2004. The costs are those incurred by the First Respondent for Mr O'Connor's assessment and further report on the amended plans and any associated legal costs, but not administration costs. 2. Each party pay its own costs for the Notice of Motion of 6 December 2004. 3. The First Respondent pay the Applicant's costs for the Notice of Motion of 27 April 2005, being the sum of $4,744.00. ______________ Annelise Tuor Commissioner of the Court 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.