> Land and Environment Court of New South Wales CITATION : C M Hairis Architects v Waverley Council [2003] NSWLEC 404 PARTIES : C M Hairis Architects Waverley Council FILE NUMBER(S) : 10157 of 2003 CORAM: Pain J Appeal :- Section 56A of the Land and Environment Court Act (1979) Whether errors of law disclosed in the Commissioner's judgment KEY ISSUES: Should leave be given to argue grounds not raised at merits hearing Should leave be given to raise new evidence Appeal dismissed LEGISLATION CITED: Land and Environment Court Act (1979) s 56A Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR; Coulton v Holcombe (1986) 162 CLR 1; Council of the City of Sydney v Goldspar Australia Pty Limited [2002] FCA 1194 (21 October 2003); Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397; CASES CITED: Holidays-A-Float Pty Ltd v Hornsby Shire Council (1992) 75 LGRA 127; Moss v Kiama Municipal Council (2003) 127 LGERA 83; Progress Securities Pty Limited v North Sydney Council (1988) 66 LGRA 23; Rutland v Shoalhaven City Council (1997) 94 LGERA 370; Suttor v Gundowda (1950) 81 CLR 418; University of Wollongong v Metwali (No 2) (1985) 59 ALJR 481 DATES OF HEARING: 17/12/2003 EX TEMPORE JUDGMENT DATE : 12/19/2003 APPLICANT: T S Hale SC SOLICITORS: Bartier Perry LEGAL REPRESENTATIVES: APPLICANT: P. McEwen SOLICITORS: McMahon and Associates JUDGMENT: IN THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES 10157 of 2003 Pain J 19 December 2003 CM HAIRIS ARCHITECTS Applicant v WAVERLEY COUNCIL Respondent Judgment 1. This is a s 56A appeal by the Council against a decision of Commissioner Watts dated 20 August 2003. The Commissioner upheld an appeal against the decision by the Council to refuse a development application to subdivide land at 10 Cross Street and build a house on that land. The grounds of appeal which are pressed on appeal are grounds 2, 4 and 5. Ground 2 2. Ground 2 in the Council's Notice of Motion states that the Commissioner erred in law in finding that the owners of 12 Ashley Street had withdrawn their objection and refers to par 22 of the judgment. There appears to be no error of law in such a finding given that it appears to be a finding of fact by the Commissioner. The argument relied on by the Council, as clarified by counsel, was that there was an error of law because Commissioner failed to give any weight to the objector's views because of his erroneous finding that the objection had been withdrawn. The Council relied on the decision of Kirby P in Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR as establishing that if reasons given by a judge or a decision-maker are based on a manifest error in fact-finding that error can amount to a point of law. 3. The Council sought to tender new evidence by way of an affidavit of a Mr Taylor and Mr Connell, the Council's solicitor, as it was said this would assist the Court in considering this matter. The tender of that evidence was rejected by me as an appeal under s 56A lies only in respect of questions of law. It is not appropriate that fresh evidence not before the Commissioner be tendered and considered by the Court on appeal. 4. No other evidence has been presented to the Court to indicate that the Commissioner's finding was at odds with the evidence before him. In the absence of any other evidence on which to found the submissions of the Council it is not clear to me that an error has been demonstrated. I therefore do not find in the Council's favour on ground 2. Grounds 4 and 5 5. Grounds 4 and 5 as set out in the Council's Notice of Motion are as follows: 4. The Commissioner erred in law in failing to recognise the legal significance of the words on the title, which were referred to at page 3 of Exhibit 1 DP302212 is still the current plan and the title description of the subject land is folio identifier A/302212. That plan also contains the words: "June 22nd, 1921. This subdivision has been approved by the Council of the Municipality of Waverley, on condition that not more than one dwelling is erected on each of the proposed allotments, and is covered by the Town Clerk's Certificate No. 91 dated the 22nd June, 1921". 5. The Commissioner erred in law in stating that the Court could over-ride the restriction referred to in (4) above. 6. The substantial difficulty faced by the Council in arguing these appeal grounds is that when relevant submissions were put to the Commissioner, as reflected in the transcript of the hearing presented to the Court, the Council did not raise any legal issue at all on the matters raised in these grounds, but rather stated the matter was a merit matter. In other words, the Council is now seeking to raise a completely new point in this s 56A appeal which it specifically did not raise before the Commissioner at first instance. 7. There was no argument before the Commissioner on the matters raised in grounds 4 and 5. There is no reference or finding on these matters in the Commissioner's decision. There was no question of law identified under Pt 13 r 4 of the Land and Environment Court rules before the Commissioner. The issue therefore arises whether this Court should give leave to raise the questions of law that are raised in grounds 4 and 5 at all. 8. It is first useful to identify what the relevant legal issue is. In 1921 the Council granted subdivision approval under s 331 of the Local Government Act 1919 which created Lots A and B in DP 30212. Lot A is now the subject of these proceedings. The Town Clerk's certificate and the file plan created at the time of the original subdivision contains a notation. That notation states: June 22 1921. This subdivision has been approved by the Council of the Municipality of Waverley on condition that not more than one dwelling is erected on each of the proposed allotments and is covered by the Town Clerk's certificate No 91 dated 22 June 1921. 9. It is agreed that the 1921 subdivision proceeded and the two lots in question were created and built upon. 10. The Council argued that the notation is a condition of a binding approval and is integral to the subdivision being approved and to the subsequent use of the land for the building of a dwelling. There is no provision in the Local Environmental Plan which applies, as contemplated by s 28 of the Environmental Planning and Assessment Act 1979 (the EP&A Act), which would allow the Council to override that notation. The notation is not a covenant or restriction created under s 88B of the Conveyancing Act 1919 but rather it was noted on the title in 1921 and operates as a condition of development consent. 11. Particular reliance was placed by the Council on the decision of Bignold J in Rutland v Shoalhaven City Council (1997) 94 LGERA 370 and also Moss v Kiama Municipal Council (2003) 127 LGERA 83. These cases concern a situation when non-compliance with the condition of a development consent was held to constitute a breach of ss 122, 123, 124 of the EP&A Act. As a result, it was said that if the Commissioner's decision stands it will be a breach of the EP&A Act by virtue of s 80(2). In consequence it is enforceable under s 123 of the EP&A Act by any person. 12. It was also said that in obtaining the benefit of the unusual allotment shape in Lot A the Applicant accepted the burden that one dwelling only can be erected upon each of the proposed allotments, including Lot A. The Applicant should not have the benefit of the consent without the burden, relying on Progress Securities Pty Limited v North Sydney Council (1988) 66 LGRA 236 amongst other cases. 13. It was also argued that the Court should exercise its discretion in favour of allowing the areas of law in grounds 4 and 5 to be raised as the issue is fundamental to the legality of the decision of the Commissioner. Reliance was placed on the decision of Holidays-A-Float Pty Ltd v Hornsby Shire Council (1992) 75 LGRA 127, a decision of Stein J in this Court, where a Council sought to challenge its own development consent. I certainly see no reason to disagree with that decision but the issue before me is different in that it concerns the conduct of the Council in legal proceedings before this Court and the way the Council has chosen to run its case at first instance. 14. I will briefly review the Applicant's submissions. The Applicant's submission is that the Council does not identify an error on a question of law and one is not demonstrated in the Commissioner's judgment at all. The Applicant correctly pointed out that it is unclear from the Council's submissions whether it is submitting that the condition of the 1921 subdivision approval: (a) precludes, as a matter of law, a consent authority granting development consent for the subdivision of Lot A and the erection of a dwelling house on the newly subdivided and vacant lot; or (b) is the matter relevant to the consent authority's exercise of discretion as to whether or not to grant development consent for the subdivision and erection of a dwelling. 15. It was submitted that in neither the first or the second case is an error of law raised. The cases relied on in relation to the benefit and burden of development consent conditions such as Progress Securities Pty Limited v North Sydney Council (1988) 66 LGRA 236, are cases dealing with the exercise of the Court's discretion in any event and should not be relied on in an appeal on a question of law. 16. The Applicant further argued that leave should not be granted to argue grounds 4 and 5, relying on the decisions of Suttor v Gundowda (1950) 81 CLR 418 , Coulton v Holcombe (1986) 162 CLR 1 , University of Wollongong v Metwali (No 2) (1985) 59 ALJR 481 and Council of the City of Sydney v Goldspar Australia Pty Limited [2002] FCA 1194 (21 October 2003). Essentially these cases held that if a party seeks to advance for the first time on appeal a new ground not taken at trial it will be precluded from doing so if the new ground could possibly have been met by calling evidence at the hearing or if, had the ground been raised below, the respondent might have conducted the case differently at trial. In Coulton it was held that it is fundamental to the due administration of justice that the issues between the parties are ordinarily settled at the trial. If this were not so the main arena for the settlement of disputes would move from the court of first instance to the appellate court. 17. The Applicant argued that had the point now sought to be raised by the Council been raised at the hearing before the Commissioner or earlier, it is likely that additional evidence would have been called, or sought to be called, and additional issues based on that evidence aired before the Commissioner or before a judge of the Court if the matter had been argued as a preliminary point of law. Furthermore, the Commissioner simply addressed the issue in the way the Council asked him to. The Applicant contends that this ground is not open on appeal and no error of law is disclosed. Finding 18. The first hurdle the Council must overcome is that this is a s 56A appeal before me. That is an appeal against a finding of the Commissioner's decision. There has been no reference to any relevant finding in the Commissioner's judgment as a basis on which to found grounds 4 and 5. Arguably there is no error of law identified in the Commissioner's decision in relation to grounds 4 and 5 as there is simply no reference to those issues in the Commissioner's decision. 19. Even if the section of transcript relied on by the Council is considered, putting aside the issue whether that forms in any way part of the Commissioner's determination for the purposes of this appeal, there is arguably no relevant finding by the Commissioner at all in that transcript. Consequently the Council falls at the first hurdle in that there is no identifiable error of law. 20. Assuming that I could consider there was an identifiable error of law against which to appeal, I agree with the Applicant that it is not appropriate in the circumstances before me to give leave to the Council to raise grounds 4 and 5 in this s 56A appeal. Firstly, even the authorities relied on by the Council (to which I was referred in the Ritchie Supreme Court Procedure Service) suggest that such an approach should only be allowed in exceptional circumstances. While the Council argued that the notation on the subdivision plan was clear on its face and no further evidence or enquiry was necessary in order for this issue to be determined by this Court, I consider it is highly likely that different evidence and different arguments would have been presented to the Commissioner or, indeed, a judge if this matter had been considered as a preliminary point of law, which is not able to be canvassed before me. It is not appropriate for the Court to entertain fresh evidence on a s 56A appeal even if the Applicant had been in a position to proceed and the Court exercised its discretion to allow the matter to proceed. 21. I also reject the Council's submission that, because there is no evidence as to prejudice put on by the Applicant in an affidavit, it should be assumed that there is no prejudice. Given the recent notice to the Applicant by the Council of the arguments to be put I do not consider the Applicant is under any obligation to put on such an affidavit. 22. As I consider it is not appropriate to grant leave to raise grounds 4 and 5 as a matter of discretion I do not need to deal with the merits of whether or not there is an error of law by the Commissioner. Indeed, as I have already stated, it does not appear on the face of his judgment that there is such an error given there is no reference at all to the issues raised in grounds 4 and 5. 23. I observe, however, that it is not clear to me on the arguments, to the limited extent they were aired before me, that the error of law is as manifest as the Council submitted. The Court has before it a 1921 subdivision approval which was intended to permit the registration of a subdivision under the Conveyancing Act 1919. The cases of Rutland and Moss relied on by the Council are not necessarily conclusive on the question of law before me. These cases arguably deal with different circumstances and I am not convinced that the issues of law raised are as straight forward as the Council's argued. 24. I also note that in relation to one of the arguments put forward by the Applicant that, once there is compliance with s 327(2) of the Local Government Act 1919 and a plan of subdivision is registered, the approval is arguably spent and therefore does not apply in the year 2003. 25. There were additional arguments raised by the Applicant which were not, I think, fully explored before me and which would require further attention before this Court could reach a concluded view on these matters. I make no finding whatsoever on the merits of the issues raised in grounds 4 and 5. 26. The Council has advised the Court that it is considering commencing Class 4 proceedings if I do not give leave in this s 56A appeal to argue grounds 4 and 5. It says these proceedings will raise the same issues and will seek orders and declarations in relation to the Commissioner's decision. It is a matter entirely for the Council as to whether it wishes to proceed on that path and I make no finding as to whether or not such a course is even open to the Council. Given that Commissioner Watts' decision now stands as I am dismissing the s 56A appeal so that the Applicant has a valid development consent issued by the Court, such a course is novel to say the least. 27. I was also asked to consider the matter of costs. The Applicant is seeking indemnity costs in the event that it is successful, which it is, on the basis that the Council embarked on a hopeless application. The Council opposed such an order being made and argued that indemnity costs are not appropriate where it has not been demonstrated that the Council's action is frivolous, an abuse of process or waste of the Court's time. I intend to apply the decision of Woodward J in Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 to which I have been referred. His Honour held: Whenever it appears that an action has been commenced or continued in circumstances where the Applicant properly advised should have known that he had no chance of success, in such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts or the clearly established law. 28. I do not think in this case that the Council's pursuit of this s 56A appeal warrants an award of costs on an indemnity basis. I will make an order that the Council is to pay the Applicant's costs of this s 56A appeal. Order 29. The Court orders that: 1. The Respondent's s 56A Appeal is dismissed. 2. The Respondent pay the Applicant's 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.